1974 (1) TMI 11

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....ing period ended on March 31, 1963, and the return under section 139(1) of the Act was due by 30th of September, 1963. The return was, however, filed on June 26, 1965. The Income-tax Officer issued a notice under section 271(1)(a) of the Act to the assessee which it received on 30th June, 1965, to show cause why penalty may not be levied. The assessee made no compliance. A sum of Rs. 5,625 was imposed by way of penalty under section 271(1)(a) of the Act. The Appellate Assistant Commissioner in a cryptic order sustained the levy of penalty. Upon the assessee's appeal to the Tribunal, after taking note of the facts the Tribunal held: " We consider, however, that having regard to the facts penalty is not called for in this case. The asse....

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....enalty. We accordingly cancel the order of penalty...." The Tribunal has clearly gone wrong in relying upon the decision in the case of Kulu Valley Transport Company. The provisions under the 1961 Act are very different from those contained in the earlier law. Unlike the corresponding provision in the earlier Act, section 139 of the Act of 1961 imposes a liability upon every taxpayer whose total income exceeds the maximum amount which is not chargeable to income-tax to suo motu submit a return of his income for each assessment year as it comes along, within the time specified. The decision of the Supreme Court was with reference to the law as it existed under the 1922 Act. Therefore, the Tribunal was not correct in equating the position ....

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....ey were relying, upon the observation of the Supreme Court in the case of Hindustan Steel Ltd. v. State of Orissa. The same view has been reiterated by the said court in the case of Dawn & Co. v. Commissioner of Income-tax . A Bench of the Mysore High Court in the case of All India Sewing Machine Co. v. Commissioner of Income-tax has also taken the same view. The Tribunal in the present case has come to hold that it was the assessee's first default, the change of law had just come about and, therefore, the default was more technical than the outcome of positive disregard of statutory liability. The Tribunal was of the view that the conduct of the assessee was not contumacious. Learned standing counsel has contended that once the asses....