COMMISSIONER OF INCOME TAX Vs. VEERAWALI

JUDGEMENT

(1.) UNDER directions of this court made on an application under Section 256(2) of the Income-tax Act, 1961, at the instance of the revenue, the Income-tax Appellate Tribunal, Cuttack Bench, has stated this case and referred the following question for opinion of the court:

(2.) THE assessee is an individual dealing in mill-made cloth. THE relevant assessment years are 1965-66, 1966-67 and 1967-68. THE Income-tax Officer did not accept the returned figures of income and made additions. Ultimately, in the hands of the Appellate Tribunal, the assessee's income for the three years in question stood determined at Rs. 20,430, Rs. 15,635 and Rs. 18,670 respectively. THE Income-tax Officer initiated penalty proceedings under Section 271(1)(c) of the Act and the Inspecting Assistant Commissioner in exercise of the powers under Section 274(2) of the Act imposed penalties of Rs. 3,000, Rs. 1,600 and Rs. 5,800 respectively.