KAUSHAL CONSTRUCTION CO Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is a reference made by the Income-tax Appellate Tribunal at the instance of the assessee referring for our answer the following question of law ;

(2.) THE relevant assessment year is 1959-60. THE assessee is a registered firm. THE assessee was originally assessed on 22nd November, 1961. THE total income determined was Rs. 2,17,881. Proceedings were taken for reassessment under Section 147 of the I T. Act, 1961. A notice was issued to the assessee on 31st January, 1967. In pursuance of this notice, the return was due on 7th March, 1967. THE return was, however, filed on 1st February, 1968, after a delay of ten complete months. THE order of reassessment was passed on 20th March, 1968. By this order the total income determined was Rs. 3,03,967. Thus, the excess income that was brought under tax by the order of reassessment was Rs. 86,086. Penalty proceeding were taken against the assessee under Section 271(1)(a) of the Act for default in filing the return under Section 148. THE amount of penalty has been fixed at the rate of 2 per cent. of the tax which would be payable on the total income of Rs. 3,03,967 for each month of default.

(3.) FOR the reasons given above, the question referred to us is answered in the negative, in favour of the department and against the assessee. There will be no order as to costs of this reference.