TMI Blog1980 (4) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... was reframed on 20th February, 1971, on a total income of Rs. 49,592. Later on, the assessment order was rectified and the income was reduced to Rs. 40,592. For concealing its income, penalty proceedings were initiated against the assessee by an order of the ITO on 20th February, 1971. Since the minimum penalty imposable exceeded Rs. 1,000, the ITO referred the case to the IAC on 29th Dacember, 1972, under s. 274(2) of the Act. The IAC, vide his order dated 15th March, 1973, levied a penalty of Rs. 10,000 on the assessee under s. 271(1)(c) of the Act. Aggrieved by the Order of the IAC, the assessee preferred an appeal before the Income-tax Appellate Tribunal, Amritsar (hereinafter referred to as " the Tribunal "). The Tribunal accepted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal was right in law in holding that the Inspecting Assistant Commissioner had no jurisdiction to impose the penalty in this case? " As is clear, the primary question of law which arises for determination in this case as to what is the effect of the amendment of s. 274(2) of the Act or, in other words, is the amendment retrospective? The matter is res integra. A Division Bench of this court in CIT v. Raman Industries [1980] 121 ITR 405 considered this question at length and came to the conclusion that there is no provision in the T.L. (Amend.) Act, 1970, to indicate that the amendment of s. 274 of the Act is retrospective. It was held that the section deals with vested rights and, therefore, the amendment is prospective in operation. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ITO, the question would immediately arise as to who has the jurisdiction to pass an order for levying the penalty. It is at that point of time that the question of jurisdiction has to be determined keeping in view the prevailing provisions of law. It, of course, goes without saying that the Legislature has the power to make a particular statute applicable with retrospective effect but till that has not been done, the law which concerns the jurisdiction, has to be taken to be prospective. In the present case, as is clear from the order of the ITO dated 29th February, 1971, the ITO applied his mind and initiated the proceedings for levy of penalty against the assessee as observed by him in the order. It is at that point of time that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter of procedure and since the procedural law is retrospective, the view taken by the Tribunal in this case should hold the field. We are unable to agree with the view taken by the Orissa High Court and Allahabad High Court in the cases referred to above. In Dhadi Sahu's e [1976] 105 ITR 56 (Orissa), it was held that sub-s. (2) of s. 274 is admittedly a provision relating to procedure. This finding, in our considered opinion, has been arrived at on wrong premises. After having recorded the finding that sub-s. (2) of s. 274 of the Act relates to procedure, e learned judges of the Orissa High Court then proceeded to rely on decision of their Lordships of the Supreme Court in Anant Gopal Sheorey State of Bombay, AIR 1958 SC 915, to hold th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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