Penalty jurisdiction for concealment depends on the law at the date of concealment, and lack of competence makes the penalty void.

Concealment of income was treated as established on the record, and the revised return only reduced the concealed amount and the penalty exposure. The governing test for penalty jurisdiction was the law in force on the date of concealment, namely when the return was furnished. Because the minimum penalty then exceeded the Income-tax Officer's competence, jurisdiction vested in the Inspecting Assistant Commissioner, making the issue substantive rather than merely procedural. On that basis, the penalty order was held invalid and could not be sustained notwithstanding the finding of concealment.

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Issues: (i) Whether there was concealment of income warranting penalty; (ii) whether the Income-tax Officer had jurisdiction to impose the penalty or the matter had to be referred to the Inspecting Assistant Commissioner.

Issue (i): Whether there was concealment of income warranting penalty.

Analysis: The material on record, including the assessment proceedings, appeal records, penalty proceedings and the assessee's explanation, established concealment of income. The concealment was accepted on merits, and the revised return only reduced the quantum concealed and the penalty exposure.

Conclusion: There was concealment of income and the finding on concealment stood affirmed.

Issue (ii): Whether the Income-tax Officer had jurisdiction to impose the penalty or the matter had to be referred to the Inspecting Assistant Commissioner.

Analysis: The applicable law was the law in force on the date of concealment, namely when the return was furnished. On that date, the minimum penalty exceeded the Income-tax Officer's competence and the matter was within the Inspecting Assistant Commissioner's jurisdiction. The question of who must impose penalty was treated as one of substantive law, not merely procedural law.

Conclusion: The Income-tax Officer had no jurisdiction to levy the penalty and the penalty order was invalid.

Final Conclusion: The penalty could not be sustained because it was imposed by an lacking jurisdiction, notwithstanding the finding of concealment.

Ratio Decidendi: For penalty for concealment, the governing law is the law in force on the date of concealment, and the authority competent to impose the penalty must be determined by that law; if the officer lacks jurisdiction on that date, the penalty is void.

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