COMMISSIONER OF INCOME TAX Vs. NURUDDIN

JUDGEMENT

(1.) At the instance of Commissioner of Income-tax, West Bengal-X, the following question of law has been referred to this court under Section 256(2) of the Income-tax Act, 1961, for the assessment year 1960-61 :

(2.) The facts, shortly stated, are that the Income-tax Officer originally completed the assessment for this year on a total income of Rs. 86,814. Thereafter, the assessee is stated to have made a disclosure petition under Section 271(4A) of the Income-tax Act, 1961, before the Commissioner of Income-tax on February 28, 1967. In the said disclosure petition, the assessee admitted that cash credits introduced in the books in various names in different years including the assessment year 1960-61 represented its own income which had not been earlier disclosed in its returns of income. However, the Commissioner of Income-tax declined to accept the petition filed by the assessee. Thereupon, the Income-tax Officer initiated reassessment proceedings under Section 147(a) of the Act on the basis of the admission made by the assessee in the disclosure petition filed before the Commissioner of Income-tax and assessed the peak of the cash credits including the interest paid thereon as income of the assessee. He also initiated penalty proceedings for concealment of income under Section 271(1)(c) and as the minimum penalty exceeded Rs. 1,000, he referred the case to the Inspecting Assistant Commissioner of Income-tax under Section 274(2).

(3.) The Inspecting Assistant Commissioner, after duly considering the objections raised on behalf of the assessee, imposed a minimum penalty of Rs. 54,667 under Section 271(1)(c) of the Income-tax Act, 1961.