Penalty for concealment follows the law on the return filing date, allowing amended penalty rates to apply.

Penalty for concealment is governed by the law in force on the date the relevant return is filed, not by the law applicable to the assessment year. Where the last return was filed after the amendment taking effect from 1 April 1968, the enhanced penalty scale could apply even if the assessment year related to an earlier period. The earlier assessment year did not determine the quantum once the operative return was filed under the amended regime, and the Tribunal was in applying the pre-amendment law.

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Issues: Whether, for determining the quantum of penalty in concealment proceedings, the applicable law is the law in force in the assessment year or the law in force on the date the relevant return was filed.

Analysis: The reference was decided on the basis that penalty proceedings are governed by the law applicable on the date of filing of the return. The enhanced penalty scale introduced from 1 April 1968 could therefore apply where the last return was filed after that date, even if the assessment year related to an earlier period. The earlier assessment year did not control the quantum once the operative return had been filed under the amended regime.

Conclusion: The Tribunal was not correct in holding that the quantum of penalty had to be computed with reference to the law in force in assessment year 1966-67 rather than the amended law in force from 1 April 1968. The question was answered in favour of the Revenue and against the assessee.

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