1973 (2) TMI 14

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..... ter on, in May 12, 1964, the assessee did file a voluntary return disclosing a net loss of Rs. 9,214. The Income-tax Officer did not accept the return and assessed the assessee at a total income of Rs. 64,922, which included a sum of Rs. 40,000 as income from undisclosed sources, being the aggregate amount of three cash credits, the source and nature of which the assessee was unable to prove and which it ultimately surrendered for assessment. The Income-tax Officer also initiated proceedings for levying penalty in respect of the default committed by the assessee of the provisions of section 139(1) and ultimately imposed a penalty of Rs. 13,702 under section 271(1)(a) of the Act. The assessee's appeal to the Appellate Assistant Commissioner .....

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..... ally assessed by the Income-tax Officer. It is clear that at the time when a person is required to file a voluntary return, no assessment has yet been made against him. He is thus to be guided by what he himself believes to be his income. It is possible and it happens very frequently that an assessee may not consider a particular item to be his income and yet the Income-tax Officer may hold otherwise. In such a case, if what he considers to be his income is less than the amount which is not chargeable to income-tax, he is not required to file a voluntary return even if the income finally assessed is more than the maximum amount which is not chargeable to income-tax. Of course, the belief of the assessee must be bona fide. In the instant cas .....

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..... not liable to any penalty under section 271(1)(a). In the alternative the learned counsel for the department argued that even if the assessee's income was below Rs. 25,000 yet it was under an obligation to file a voluntary return, if it had some income. He says because the income assessed in the hands of a firm is ultimately to be included in the assessment of the partners, there is no amount which is not chargeable to income-tax in the case of a registered firm. No such question was raised before the Tribunal and, as such, it does not arise out of the order of the Tribunal. It is well settled that in a reference only those questions can be answered by the High Court as have been raised before the Tribunal and have been referred by it. It .....

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