Jurisdiction to impose subsequent penalty upheld where true profits later ascertained, making the later penalty valid.

Officer may impose a later penalty based on fuller materials discovered after an initial estimate; the officer had jurisdiction to supersede or cancel a prior penalty and to pass a subsequent penalty once true profits were ascertained from books, and both orders cannot stand concurrently so cancellation of the earlier order leaves the later operative; the factual finding that the taxpayer knowingly concealed true profits supports the penalty, and the imposed penalty is therefore upheld as legal.

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Issues: Whether the penalty of Rs. 68,501 imposed under section 28(1)(c) of the Income-tax Act, 1961 for concealment in the original return for assessment year 1951-52 is legal.

Analysis: The penalty was imposed after the Income-tax Officer, having initially proceeded by an estimate, later ascertained the true profits from produced books and initiated proceedings under section 34 culminating in a fresh assessment and a further notice under section 28(3). The officer had jurisdiction to pass a subsequent penalty order based on the fuller material and to recall or supersede an earlier penalty imposed on a lesser estimate. The fact that an earlier penalty order had been made does not render a later order void for want of jurisdiction; both orders could not stand concurrently, but cancellation of the earlier order left the later order operative. The Tribunal's factual finding that the assessee had knowledge of the true profits and had originally concealed them is binding on the reference.

Conclusion: The penalty of Rs. 68,501 imposed under section 28(1)(c) of the Income-tax Act, 1961 is legal and the appeal is dismissed in favour of the Revenue.

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