1966 (11) TMI 10

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....d not comply with the notices under sections 22(2) and 22(4) of the Act and the assessment was completed under section 23(4) of the Act on an income of Rs. 45,560 resulting in an assessment and demand of Rs. 13,778. For the default under sections 22(2) and 22(4) of the Act, the assessee became liable for penalty under section 28(1)(a) up to the maximum limit of Rs. 20,667, being one and a half times of the amount of tax assessed (i. e., one and a half times of Rs. 13,778). Apart from the above defaults, the assessee was required by a notice under section 18A(1) of the Act, dated 30th May, 1958, to deposit advance tax in the sum of Rs. 6,097 on the basis of the last completed assessment when the notice was issued. The assessee, however, d....

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....of Rs. 910 under section 18A(9) of the Act imposed a composite penalty of Rs. 6,889 under these two sections. On appeal to the Appellate Assistant Commissioner, no objection seems to have been taken as to the levy of a composite penalty but only on the merits. The Appellate Assistant Commissioner, in the circumstances of the case, reduced the penalty by Rs. 1,000. Therefore, the finally determined penalty stood at Rs. 5,889 for both the defaults under sections 22(2) and 18A(9) of the Act. The matter was carried in second appeal to the Tribunal and there, for the first time, inter alia, the objection to the levy of a composite penalty was taken. The Tribunal pointed out : "No authority had been cited for the proposition that the levy of a co....

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....of the Chief Justice Subba Rao (as he then was), in Mareddy Krishma Reddi v. Income-tax Officer, Tenali, at page 681-682, was approved. That view was : "Section 28 is one of the sections in Chapter IV. It imposes a penalty for the concealment of income or the improper distribution of profits. The defaults made in furnishing a return of the total income, in complying with a notice under sub-section (4) of section 22 or sub-section (2) of section 23 and in concealing the particulars of income or deliberately furnishing inadequate particulars of such income are penalised under that section. The defaults enumerated therein relate to the process of assessment. Section 28, therefore, is a provision enacted for facilitating the proper assessment o....

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....y of penalty. It is, however, unnecessary in these proceedings to attempt to resolve that conflict. Even if it be assumed for the sake of argument that penalty proceedings are quasi-criminal in nature that would not mean that the provisions of the Criminal Procedure Code which required that separate offences in certain circumstances should be separately tried and there should be no joinder of charges, would have application to proceedings under the Income-tax Act. The Income-tax Act is a code by itself and the proceedings have to be conducted in accordance therewith, subject always to the rules of natural justice. Similarly, the provisions of the Indian Evidence Act are also not applicable. The only question, therefore, which would require ....