Penalty for concealment under the 1961 Income-tax Act applies to earlier years if assessment was completed after commencement.

Penalty for concealment in respect of an earlier assessment year could validly be imposed under the Income-tax Act, 1961 where the assessment was completed after 1 April 1962, because section 297(2)(g) authorised initiation and levy of penalty proceedings under the 1961 Act in such cases. The challenge to the validity of that provision had already been upheld by the Supreme Court, and the plea that there was no concealment of income was treated as a factual question not examined in reference. The section 271(1)(c) penalty was therefore held legally leviable for the assessment year 1958-59, with the question answered in favour of the Revenue.

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Issues: Whether penalty for concealment of income for assessment year 1958-59 could validly be imposed under section 271(1)(c) of the Income-tax Act, 1961, when the assessment was completed after 1 April 1962.

Analysis: The assessment year was 1958-59, but the assessment itself was completed on 29 March 1963, after the commencement of the Income-tax Act, 1961. Section 297(2)(g) of the 1961 Act specifically provided that proceedings for imposition of penalty in respect of an assessment for an earlier year, if completed on or after 1 April 1962, could be initiated and penalty imposed under the 1961 Act. The challenge to the validity of that provision had already been affirmed by the Supreme Court. The plea that there was in truth no concealment of income was treated as a question of fact and was not entertained in the reference.

Conclusion: The penalty under section 271(1)(c) of the Income-tax Act, 1961 was validly leviable, and the question was answered in the affirmative in favour of the Revenue.

Ratio Decidendi: Where the assessment for an earlier year is completed on or after the commencement of the Income-tax Act, 1961, penalty proceedings for concealment may validly be initiated and imposed under section 271(1)(c) by virtue of section 297(2)(g) of that Act.

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