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TMI Blog1992 (7) TMI 111X X X X Extracts X X X X X X X X Extracts X X X X ..... t on 15-11-1988. Thereafter the Assessing Officer found that the assessee had constructed a factory building which was given on monthly rent of Rs. 9,000. The assessee's case was reopened under section 143(2)(b) of the Act with the permission of Deputy Commissioner of Income-tax, Chandigarh. On 3-1-1989, the Assessing Officer addressed a letter to the assessee-firm, a relevant extract of which is reproduced below :--- " Later on it has been found that you have constructed a building in factory area, Chandigarh which has been rented out and you are getting rent of Rs. 9,000 P. M. The income received from rent has not been shown in your return of total income. As such your case has been reopened under section 143(2)(b) of the IT Act with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me to the knowledge or possession of the Assessing Officer, then the right course was to initiate proceedings under section 147. It was submitted that though such a challenge was not raised in the assessment proceedings, the assessee was at liberty to raise this challenge in penalty proceedings which were separate and independent proceedings. It was vehemently argued that on the facts of the case, no penalty was exigible in this case. 4. Shri A. P. Kackria, the learned D. R., on the other hand, equally forcefully submitted that the assessee firm had shown rental income at Rs. 38,300 in its return for the assessment year 1987-88. According to him, a sum of Rs. 38,300 was shown as " rent of industry " in the profit and loss account, a copy o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the original return without declaring property income. Reliance in this regard was placed on the Supreme Court decision in CIT v. Onkar Saran & Sons [1992] 195 ITR 1 and of the Tribunal in ITO v. Sat Pal Ved Parkash, Kiryana Merchants [1991] 39 ITD 39 (Chd.). It was strongly argued that the second return filed on 23-1-1989 was not at all voluntary and that the assessee disclosed the rental income when it had no other course left open to it. He justified the confirmation of penalty in this case. 5. We have carefully considered the rival submissions as also the facts on record. It is a fact that the assessee did not disclose income from factory building in its original return filed on 29-7-1988. The question to be determined is whether s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourse to initiate proceedings should have been under section 147. The learned Counsel for the assessee took pains to emphasise that section 143(2)(b) and section 147 were mutually exclusive and operated in different fields. We, however, do not find much substance in this submission. The Assessing Officer could certainly take action under section 147 but the action could also be taken by him under section 143(2)(b) because the time limit of six months was still available. When two courses are open to the Revenue authority which are equally tenable in law, then it is the prerogative of the Assessing Officer to choose either of the courses. We are not impressed by the argument that proceedings were wrongly initiated under section 143(2)(b) of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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