TMI Blog1996 (1) TMI 147X X X X Extracts X X X X X X X X Extracts X X X X ..... two years in question. 3. The assessee is a registered firm. The previous years, for the assessment years 1981-82 and 1982-83, ended on 31-3-1981 and 3 1-3-1982 respectively. The original assessments were completed on 19-3-1983 and 6-1-1987 respectively for the two years in question. There was a survey under section 133A in the business premises of the assessee on 18-10-1988. In the course of the survey it was noticed that the closing stock declared by the assessee for the assessment years 1981-82 and 1982-83 was less than the closing stock declared before the Commercial Tax Department. Hence, the assessments were reopened under section 147(a) of the Income-tax Act, 1961. Notice under section 148 was issued to the assessee on 9-1-1989. No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,721 was covered up in the extra sales of Rs. 1,20,000 declared. As such, it was contended on behalf of the assessee, that no addition was called for on this ground. During the survey it was noticed that in the account of M/s. K.S.F.I.C., Dandeli, the amount shown as due as on 31-3-1984 was more than what was actually due as on that date. When enquired into, it was found that during the assessment years 1980-81, 1981-82 and 1982-83, the assessee had paid Rs. 1,30,075 outside the books. The assessee filed revised return offering Rs. 36, 100 for tax, for the assessment year 1981-82 and Rs. 32,800 for assessment year 1982-83 for tax, in addition to the income declared earlier. This had been accepted and the assessments completed for the abov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment proceedings. It is argued that in the original assessment proceeding under section 143(1)(a) no penalty proceedings, for the assessment years 1981-82 and 1982-83, were initiated. The learned counsel for the assessee admitted that for the assessment year 1981-82 the return was due on 31-7-1981 but was filed on 18-2-1983 and, for the assessment year 1982-83, the return was filed on 20-1-1986 whereas it was d due to be filed on or before 31-7-1982. The proceedings under section 148 notice were initiated on 9th January, 1988 and were completed on 21-3-1989 and 20-1-1989 respectively. The assessments, under section 143(1) were completed on 19-3-1983 and 6-1-1987 respectively for the assessment years 1981-82 and 1982-83 without initiati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under consideration. According to the learned departmental representative there are honest and dishonest taxpayers. According to him, the law does not prevent the taxing authorities from initiating penal proceedings under section 271(1)(a) on the basis of the income returned in the revised returns in response to notice under section 148. For this proposition, he placed reliance on the judgment of the Supreme Court in the case of CIT v. Sun Engg. Works (P.) Ltd. [1992] 64 Taxman 442, particularly the observations at page 455. He further argued that the commentary at page 5855 of Chaturvedi and Pithisaria on Income-tax Law is based on the decision of the Calcutta High Court in the case of B.P. Bajoria v. CIT [1982] 135 ITR 734. Accordingly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rns. The delay occurred in filing the original returns is not originally considered for initiation of penalty proceedings. In the original assessments it is decided that no penalty proceedings need be taken for the reason that no tax is due originally. Subsequent to the survey under section 133A the assessee filed revised returns showing positive income for the assessment years 1981-82 and 1982-83. We do not find any provision in the Act empowering the ITO to initiate penal action under section 271(1)(a) while considering revised returns filed in response to notice under section 148 for the purpose of making re-assessment. Hence, we hold that the authorities below were not justified in imposing penalty on the assessee, for the assessment ye ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
