1988 (4) TMI 41

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....at the penalty in each year is restricted to the close of the subsequent previous year ? " The assessee was to file return under section 139(1) of the Act by the 30th of June of each year for the assessment years 1961-62, 1962-63, 1963-64 and 1964-65. The assessee did not file the returns as required under section 139(1). No notice under section 139(2) of the Act was served. The assessee filed the returns under section 139(4) on the Act on June 30, 1964, August 30, 1965, September 21, 1965, and December 30, 1965, respectively. The Income-tax Officer initiated proceedings under section 27l(1)(a) of the Act for the default of the assessee and rejecting the explanation offered by the assessee, imposed penalties of Rs. 24,489, Rs. 22,621, Rs....

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....he steps taken for levy of such penalty, starting with the notice to show cause and culminating in the service of notice of demand, relate to one single assessment year. The expression " assessment year " has been defined in section 2(9) of the Act to mean " the period of 12 months commencing on the first day of April every year ". If, therefore, it was held, that penalty under section 271(1)(a) is leviable for the default relating to one assessment year, the default cannot be projected into subsequent assessment year or years. There is no provision under the Act for carrying over the default in filing the return beyond the limits of an assessment year. The cases were thereafter taken up by the Tribunal for recomputation of the quantum of p....

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....ing the return has to be taken to have come to an end with the filing of the return of income, if it is filed before the best judgment assessment under section 144 and within the period prescribed under section 139(4) and in a case of no return of income filed at all, with the assessment of income as prescribed under section 144. In this respect, I am in respectful disagreement with the view taken in the case of Addl. CIT v. Bihar Textiles [1975] 100 ITR 253 (Pat) and the view taken by S. P. Sinha J., in Addl. CIT v. Dongarsidas Beharilal [1979] 116 ITR 897 (Pat). The view that I have taken must necessarily lead to answering the first question referred to us against the assessee, both in its original form as also as reframed. The penalty on....