TMI Blog1975 (11) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... the Income-tax Act, 1961 ? 2. Whether, on the facts and circumstances of the case, it is legal on the part of the Income-tax Officer to impose two penalties for the same offence, namely, delay in filing the return of income as required under section 139(1)(iii) of the Income-tax Act, 1961 ? " The assessee is a partnership concern whose accounting year ended on 31st March, 1962, for the assessment year 1962-63. The firm was liable to file a return before September 30, 1962. On September 29, 1962, the managing partner applied to the Income-tax Officer for 2 months' time for filing the return on the ground that the audit of the account had not been completed. This was allowed. But no return was filed within the extended time. It was fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39(1), proviso(iii), it cannot be said that the jurisdiction of the Income-tax Officer to levy penalty under section 271(1)(a) is ousted. The correctness of the decision of the Tribunal on the latter point is challenged by the assessee and so the above questions have been referred for decision. Section 139(1) requires every person whose total income exceeds the maximum amount which is not chargeable to income-tax to furnish a return of his income before the expiry of six months from the end of the previous year which expired last or 30th June in the assessment year, whichever is later. The Income-tax Officer may in his discretion extend the date for furnishing the return on an application made in the prescribed manner in which case inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but only compensatory in character. The following observation at page 577 of that decision is relevant in this connection : " We do not think this objection is well-founded. It suffers from several defects. In the first place, it is not correct to say that interest chargeable to a person who files his return of income under section 139, sub-section (4), is ' penal interest ', though that is an expression which is commonly in use in income-tax parlance. It is not by way of penalty that interest is chargeable from a person who does not file his return within the time allowed to him under sub-section (1) of section 139. If we look at clause (iii) of the proviso to sub-section (1) of section 139, it is clear that even where the Income-tax O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er and both are provided for by the Act. Therefore, the Tribunal is right in holding that the power to levy penalty not ousted by the charging of interest on the tax payable by the assessee. Though the failure to file a return is a violation of a provision in the Act, it will amount to an offence only if it is found that the failure was wilful.In Gursahai Saigal v. Commissioner of Income-tax the Supreme Court had occasion to consider the nature of the penalty. The provisions of section 18A of the old Act arose for consideration in that case. In the course of the said decision the Supreme Court held that the penalty under sub-section (9) of section 18A is an addition to the liability and is not a penalty for an offence as understood in cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the part of the assessee. Article 20(1) of the Constitution can have no application to a case where a penalty is imposed not as punishment for an offence but for some other collateral purpose." Again the question whether a proceeding under section 271 can be taken when interest has been levied on the assessed amount under section 139(1), proviso (iii), arose for consideration before the Calcutta High Court in Narandas Paramanand Das v. Income-tax Officer. It was held that a penalty is a quite different proceeding and the levy of interest will not prohibit the levy of penalty. To the same effect is the decision of the Madras High Court in Express Newspapers (P.) Ltd. v. Income-tax Officer. At page 256, it is observed thus : " When ..... X X X X Extracts X X X X X X X X Extracts X X X X
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