Prospective amendment to penalty jurisdiction confirmed: pre-amendment authority could complete concealment proceedings for an earlier assessment year.

The amendment made by the Taxation Laws (Amendment) Act, 1975 withdrawing the Inspecting Assistant Commissioner's power to impose penalty was treated as prospective. For concealment proceedings relating to assessment year 1973-74, the authority competent under the unamended law retained jurisdiction to complete the penalty proceedings even though the final order was passed after 1 April 1976. The earlier view that jurisdiction had to continue until the date of the final order was disapproved in light of the later Supreme Court ruling, and the penalty order was held valid under section 271(1)(c) read with section 274 of the Income-tax Act, 1961.

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Issues: Whether the Inspecting Assistant Commissioner retained jurisdiction to impose penalty under section 271(1)(c) for assessment year 1973-74 after the amendment brought about by the Taxation Laws (Amendment) Act, 1975 with effect from 1 April 1976.

Analysis: The amendment withdrawing the Inspecting Assistant Commissioner's power was treated as prospective. Since the concealment proceedings related to assessment year 1973-74, the authority competent on the relevant statutory footing continued to have jurisdiction to complete the penalty proceedings notwithstanding that the final order was passed after the amendment came into force. The earlier view that jurisdiction had to subsist till the date of the final order was disapproved in light of the later Supreme Court ruling.

Conclusion: The Inspecting Assistant Commissioner had jurisdiction to pass the penalty order under section 271(1)(c) read with section 274 of the Income-tax Act, 1961 for assessment year 1973-74, and the question is answered in favour of the Revenue.

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