Post-assessment penalty under Income Tax law upheld where notice was timely and concealment was found during proceedings.

Section 28 was construed to allow the Income Tax Officer to impose penalty after the assessment order and after tax payment, so long as notice had been issued in time and the officer was satisfied during the proceedings that concealment or inaccurate particulars had been furnished. The word "payable" was read as referring to the amount assessed, whether or not already paid. Because the Act did not require the penalty order to be made simultaneously with the assessment, the post-assessment penalty was held valid and the issue was answered in favour of the Revenue.

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Issues: Whether the Income Tax Officer had power to impose penalty under Section 28 after the assessment order had been made and the tax had been paid, provided notice had been issued within time in the course of the proceedings.

Analysis: The power to impose penalty under Section 28(1) was held to arise when the Income Tax Officer was satisfied in the course of proceedings that concealment or inaccurate particulars had been furnished. The word "payable" in the provision was construed to mean the amount to which the assessee had been assessed, whether or not it had already been paid. The provision was read as permitting the penalty order to be made after assessment, since no language in the Act required simultaneity with the assessment order. This construction was preferred as the more reasonable one and as avoiding practical difficulties for both the Department and the assessee.

Conclusion: The Income Tax Officer had power to impose penalty under Section 28 after the assessment order and payment of tax, and the question was answered in the affirmative in favour of the Revenue.

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