TMI Blog1976 (8) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... t time he was civil assistant surgeon at the Osmania General Hospital, Hyderabad. It appears that, apart from the Government service he was permitted private practice and, thus, besides his salary income, he also derived income from private practice. On November 28, 1968, he filed a return of income disclosing Rs. 7,200 as income from private practice and Rs. 7,456 as income from Governmental service. The assessee did not maintain books of account nor was he maintaining any diary in respect of income from private practice. The amount of Rs. 7,200 was returned on an ad hoc estimate made by the assessee himself. The Income-tax Officer received information that the assessee earned at least Rs. 16,450 from private practice in the relevant year of account. The assesee was examined on oath by the Income-tax Officer on September 19, 1970. In the course of such examination several details were elicited by the Income-tax Officer and the assessee having learnt that the Income-tax Officer got information regarding his professional receipts on the basis of details furnished by various employees of Central Government departments, filed a revised return on November 2, 1970, declaring a sum of Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioner had no jurisdiction to deal with the penalty matter if the amendment as per Act 42 of 1970 was to be applied since the minimum penalty imposable was less than Rs. 25,000, and the Income-tax Officer alone was competent to deal with the matter. Both these contentions urged on behalf of the assessee was rejected by the Inspecting Assistant Commissioner and he imposed a penalty of Rs. 12,000 by his order dated March 20, 1973. The Inspecting Assistant Commissioner invoked the provisions of the Explanation to section 271(1)(c). Against the order of the Inspecting Assistant Commissioner, the assessee took the matter in appeal before the Tribunal and the same two contentions which were urged before the Inspecting Assistant Commissioner were again urged before the Tribunal. The Tribunal also rejected the two contentions and held that the order of penalty was not barred by limitation nor could it be said that the Inspecting Assistant Commissioner had no jurisdiction to impose the penalty. The Tribunal, however, accepted the contention urged on behalf of the assessee with regard to the quantum of penalty. The Tribunal concluded that the quantum of penalty should be in accordance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prior to the amendment which came into force with effect from April 1, 1968. Since the offence for which the penalty is imposable under section 271(1)(c) occurred on November 28, 1968, when the assessee filed the return showing much lesser income from private practice, the law which was in force on November 28, 1968, would govern the question of imposition of penalty in the light of these Division Bench judgments of our High Court. Under these circumstances, question No. 1 which has been referred to us at the instance of the revenue must be answered as follows : The quantum of penalty to be levied should be as per the amended provisions of section 271(1)(c) which came into effect on April 1, 1968. Question No. 1 is, therefore, answered in the affirmative, i.e., in favour of the revenue and against the assessee. As regards question No. 2 which has been referred to us at the instance of the assessee, it must be pointed out that the only point which Mr. Rathi, appearing for the assessee, urged before us is that the order of the Inspecting Assistant Commissioner passed on March 20, 1973, was barred by limitation. He contended that under the law as it prevailed prior to the amendmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thin its jurisdiction. " In arriving at this conclusion the Supreme Court relied on certain observations of Sir John Beaumont delivering the opinion of the Privy Council in Joy Chand Lal Babu v. Kamalaksha Chaudhury, AIR 1949 PC 239. However, in a recent decision in M. L. Sethi v. R. P. Kapur, AIR 1972 SC 2379, Mathew J., speaking for the Supreme Court, has dissented from this view. After citing passages from the decision of the House of Lords in Anisminic Ltd., In re [1969] 2 AC 147, Mathew J. observed in paragraph 11 of the judgment at page 2385 as follows : " The dicta of the majority of the House of Lords, in the above case, would show the extent to which ' lack ' and ' excess ' of jurisdiction have been assimilated or, in other words, the extent to which we have moved away from the traditional concept of ' jurisdiction '. The effect of the dicta in that case is to reduce the difference between jurisdictional error and error of law within jurisdiction almost to vanishing point. The practical effect of the decision is that any error of law can be reckoned as jurisdictional. This comes perilously close to saying that there is jurisdiction if the decision is right in law but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the passing of an order of penalty was barred by limitation after December 21, 1972, i.e., after the expiry of two years from the date on which the order of assessment was passed. Both the Inspecting Assistant Commissioner and the Tribunal rejected these two contentions. The order of the Tribunal deals at length with both the contentions, viz., limitation as well as jurisdiction. However, when the question came to be referred to this court for the opinion of the court under section 256(1), at the instance of the assessee, it is only the question regarding jurisdiction of the Inspecting Assistant Commissioner that is referred to us. No application has been made by the assessee saying that the question which was referred did not correctly express the contention which he wanted to urge for the opinion of the High Court. Under these circumstances, we have not accepted Mr. Rathi's contention that the issue of limitation is referred to this court by the use of the word " jurisdiction " occurring in question No. 2 which has been referred to us at the instance of the assessee. We can only deal with the question which is actually referred to us and we cannot canvass questions of law in ge ..... X X X X Extracts X X X X X X X X Extracts X X X X
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