9911796707
TMI Blog1988 (12) TMI 39X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 271(1)(c) of the Income-tax Act, 1961, in this case ? 2. Whether, on the facts and in the circumstances of this case, the Tribunal's finding that the assessee had not been heard before the order imposing the penalty was made was based on no evidence or based only on irrelevant materials and/or was otherwise unreasonable ?" The controversy in this reference relates to the jurisdiction and validity of the penalty order under section 274(2) read with section 271(1)(c) passed by the Inspecting Assistant Commissioner and the correctness of the finding of the Tribunal that the assessee was not heard before imposition of penalty. The assessee is a registered firm and the relevant assessment year is 1961-62 for which the previous y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee and feeling bound by the decision of the Calcutta High Court, held that the Inspecting Assistant Commissioner, Range-V, Calcutta, wrongly assumed jurisdiction. The Tribunal also observed that the notice dated January 6, 1968, issued by the Inspecting Assistant Commissioner was bad in law as the Income-tax Officer, Hundi Circle, had not made any reference to him and the notice in the printed form was issued in a mechanical way. Before the Tribunal, the assessee had also raised a plea that it was not allowed reasonable opportunity of being heard before imposition of penalty. The grievance of the assessee related to obtaining of certified copies of statements and inspection of books of account impounded by the income-tax Officer. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... completely divested of the jurisdiction in respect of the case of the assessee and exclusive jurisdiction was conferred on the Inspecting Assistant Commissioner, Range V. It must, therefore, be held that the penalty proceeding of the assessee before the Inspecting Assistant Commissioner, Range IV, stood transferred to the Inspecting Assistant Commissioner, Range V. It is a matter of procedure and it does not, in any way, affect the assessee prejudicially so long as the successor-in-office gives reasonable opportunity to the assessee of being heard before any penalty is levied. In our view, having regard to the fact that not only the case was transferred from one Income-tax Officer to another but jurisdiction of the case was also transferre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IV(3), Calcutta, for necessary action. This notice is on record and has been set out earlier. The assessee duly received this notice as appears from an acknowledgement signed by the assessee which is also on record. The Inspecting Assistant Commissioner, in his order imposing the penalty has particularly noted this notice dated March 24, 1966. In the notice dated February 28/29, 1968, the Inspecting Assistant Commissioner, Range XVII, Calcutta, has no doubt stated that the Income tax Officer, Special Circle VII, has referred the matter for imposition of penalty. This, obviously, is incorrect. This, by itself, in our view, cannot vitiate the entire penalty proceeding inasmuch as the initial reference by the Income-tax Officer, 'F' Ward, Dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to know that certified copies of documents were supplied to the assessee on February 27, 1968, and the assessee inspected the books of account on February 23, 1068, February 24, 1968, February 26, 1968, February 27, 1968, and February 28, 1968. It is clear that after going through the books of account and records and after obtaining certified copies of the documents, the assessee was convinced that the concealment has been conclusively established in this case by the Income-tax Officer." The Tribunal held: After giving careful consideration to the rival submissions, we are of the opinion that the assessee was perfectly justified in its contentions. There is no evidence before us to the effect that the letter dated February 23, 1968, was s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income tax Officer for having inspection of the records and for obtaining certified copies of documents. In this connection, we must mention that the Income-tax Officer impounded all the account books of the assessee relevant to this assessment year on April 23, 1964. Thus, the assessee was not having the relevant accounts and documents without which it was not possible for the assessee to plead its case before the Inspecting Assistant Commissioner in the course of the penalty proceeding. On this context too, we held that the penalty order was bad in law and deserves to be cancelled." In our view, the Tribunal failed to take into account the findings of the Inspecting Assistant Commissioner. The view of the Tribunal is too technical. If t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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