PAWAN KUMAR MORE Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) PETITIONER, an assessee, under the I.T. Act of 1961 (hereinafter referred to as " the Act"), assails the imposition of penalty of Rs. 10,000 on him under Section 271(1)(c) read with Section 274(2) of the Act by the IAC of Income-tax, opposite party No. 2, for the assessment year 1968-69. Assessee holds a moiety share in a registered firm by name M/s. Capital Watch and Radio Emporium. For the assessment year 1968-69, the ITO found the assessee to have invested a sum of Rs. 22,000 in his capital account. He accepted the assessee's explanation to the extent of Rs. 12,000 and treated a sum of Rs. 10,000 as income from unexplained sources and directed initiation of penalty proceedings under Section 271(1)(c) of the Act by his order dated April 8, 1969. The records were transmitted to the IAC in terms of Section 274(2) of the Act. While the proceedings were pending, by the Taxation Laws (Amendment) Act of 1970, which came into force from April 1, 1971, the provision in Section 274(2) of the Act underwent an amendment. Prior to the amendment, Sub-section (2) of Section 274 read thus:

(2.) UPON amendment, the provision read thus :