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TMI Blog1973 (4) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... regulated with reference to the provisions of section 271(1)(c) before its amendment on April 1, 1968, and as the minimum penalty under section 271(1)(c) fell below Rs. 1,000 only the Income-tax Officer has jurisdiction to proceed with the penalty proceedings?" The material facts leading to this reference as stated by the Tribunal are as follows: The assessee, Ramchand Kundanlal Saraf of Bina, is the karta of a Hindu undivided family and the dispute relates to the period 1961-62 and 1962-63. In the original returns submitted by the assessee, he had shown income from house properties in respect of two houses only. After the completion of the original assessment proceedings, the assessment was reopened and notices for reassessment under sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed income, would not be applicable to this case as it could not be given retrospective operation. Thus, according to him, the penalty, if any, must be computed in accordance with the provisions of section 271 of the Act as it stood before the amendment. It was further contended that as the minimum penalty under section 271(1)(c) as it stood before the amendment fell below Rs. 1,000, the Income-tax Officer had jurisdiction to proceed with the penalty proceedings. These contentions were upheld by the Tribunal. It, accordingly, set aside the orders of the Assistant Commissioner in respect of these years and directed that the matter shall go back to the Income-tax Officer for fresh decision according to law. The department, being aggrieved by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at any person- . ...... (c) has concealed the particulars of his income or furnished inaccurate particulars of such income, he may direct that such person shall pay by way of penalty,.... (iii) in the cases referred to in clause (c) in addition to any tax payable by him, a sum which shall not be less than, but which shall not exceed twice, the amount of income in respect of which the particulars have been concealed or inaccurate particulars have been furnished." A comparison of the provisions of section 271 before and after amendment shows that the penalty provisions for concealment of income have been made very stringent and the amount of penalty leviable has been much enhanced. The point for consideration in this case is whether t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e principle is applicable to the imposition of penalty. Learned counsel for the department has invited our attention to the provisions of clauses (f) and (g) of sub-section (1) of section 297 of the Act, the relevant part of which is reproduced below. "297. Repeals and savings.-(1) The Indian Income-tax Act, 1922 (XI of 1922), is hereby repealed. (2) Notwithstanding the repeal of the Indian Income-tax Act, 1922 (XI of 1922) (hereinafter referred to as the repealed Act),-........ (f) any proceeding for the imposition of a penalty in respect of any assessment completed before the 1st day of April, 1962, may be initiated and any such penalty may be imposed as if this Act had not been passed; (g) any proceeding for the imposition of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty. We are, however, unable to accept this contention, and we do not think that it would be proper to draw any such conclusion from clause (g) of sub-section (2) of section 297, which is a provision of limited application and is attracted only where the question of imposing penalty in respect of an assessment year prior to the commencement of the Act arises. The question how far amendment of the 1961 Act would govern the question of penalty in respect of assessment years prior to the amendment stands on a different footing. Liability for penalty is incurred by an assessee for concealment of income. The provisions relating to penalty are of a penal character and their object is to punish the assessee so as to deter him from concealin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e April 1, 1968, when the original returns for the assessment years 1961-62 and 1962-63 were filed. It is not disputed that in the fresh returns which were filed after April 1, 1968, during the assessment proceedings, there was no concealment of income. In fact, it is clear from the statement of the case that these returns brought to light the earlier concealment of income and in respect of that the penalty was imposed. We are, therefore, in agreement with the Tribunal that the penalty would be leviable in accordance with the provisions of section 271 of the Act as they stood prior to the amendment and not after the amendment. Surely, if the concealment had taken place after April 1, 1968, the amended provisions would be attracted, We may ..... X X X X Extracts X X X X X X X X Extracts X X X X
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