Late filing before assessment does not trigger surtax penalty where the statute permits filing up to assessment completion.

Penalty under section 9 of the Companies (Profits) Surtax Act, 1964, was not attracted where the return was filed late but before assessment was completed. The statutory scheme allowed a return or revised return to be furnished up to the time of assessment under section 5(3), and section 9 applied only to failure, without reasonable cause, to furnish the return required under section 5. On a strict reading of the taxing statute, no liability could be implied beyond the words used, and any ambiguity had to be resolved in favour of the assessee.

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Issues: Whether penalty under section 9 of the Companies (Profits) Surtax Act, 1964, is leviable for belated filing of a return when the return is filed before completion of assessment.

Analysis: The statutory scheme permitted a return or revised return to be furnished up to the time assessment was made under section 5(3). Section 9 imposed penalty only where there was failure, without reasonable cause, to furnish the return required under section 5. On a conjoint reading of the provisions, late filing before assessment did not amount to the kind of default attracting penalty. In a taxing statute, nothing can be implied beyond the words used, and any ambiguity must operate in favour of the assessee.

Conclusion: Penalty was not leviable for late filing of the return before assessment was completed. The question was answered in the affirmative, in favour of the assessee.

Ratio Decidendi: Where the governing statute permits filing of a return before assessment is completed, penalty cannot be imposed merely because the return was filed beyond the prescribed time, unless the statute expressly creates liability for such belated filing.

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