TMI Blog1980 (2) TMI 32X X X X Extracts X X X X X X X X Extracts X X X X ..... (question No. 1 at the instance of the revenue and question No. 2 at the instance of the assessee) to this court under s. 256(1) of the I.T. Act, 1961 (hereinafter called " the Act ") : " (1) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the Inspecting Assistant Commissioner of Income-tax was not legally competent to pass the penalty o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reduce the total income to Rs. 10,738. The IAC, after hearing the assessee, imposed a penalty of Rs. 16,000 under s. 271 (1)(iii) of the Act, vide order dated March 4, 1972. This order was challenged by the assessee by way of appeal before the Appellate Tribunal on two grounds, namely, that the penalty order having been passed more than two years after the assessment order was without jurisdictio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he order imposing the penalty was passed on March 4, 1972. The limitation for imposing the penalty is contained in s. 275(b) of the Act. When the notice was issued the said clause provided that the penalty could be imposed within two years of the date of the final order in the assessment proceedings in which the notice for penalty was issued. But before the date when the penalty was imposed, the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of penalty had to be completed, was amended by the Taxation Laws (Amendment) Act, 1970, with effect from April 1, 1971, and after its amendment the penalty proceedings could be completed within two years of the completion of the financial year in which the penalty proceedings were initiated because the section embodies a rule of limitation which is procedural in character and, therefore, would go ..... X X X X Extracts X X X X X X X X Extracts X X X X
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