1978 (1) TMI 63

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....ment year 1966-67, the assessee filed a return on 10th of March, 11 969, declaring a total income of Rs. 10,250. Since the assessee did not appear, the Income-tax Officer completed the assessment ex parte by estimating the income of Rs. 25,250. He initiated penalty proceedings and referred the matter to the Inspecting Assistant Commissioner. The Inspecting Assistant Commissioner gave notice to the....

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.... invoked the provision of the Explanation to section 271(1)(c) as it stood amended after April 1, 1968. He held that the amendment could not apply to assessment years prior to the coming into force of the amendment, although the return of income had been filed after the amendment had commenced operation. For this view he relied upon a decision of Hajee K. Assainar v. Commissioner of Income-tax [19....

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.... read with its Explanation." To recapitulate, the assessment year in question is 1966-67, the return for which was filed on 10th of March, 1969. The observation of the Tribunal that the Inspecting Assistant Commissioner has considered the Explanation as amended on April 1, 1968, does not appear to be correct. The Explanation to section 271(1)(c) was never amended. It is clause (iii) of the sect....

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.... that the law applicable under the Income-tax Act to a particular assessment year is the law prevailing on the first day of April of that year does not apply to penalty proceedings, as penalty proceedings are not part of the assessment proceedings. The law which will apply to penalty proceedings will be the law as it stands on the day on which the default is committed. In cases of concealment or o....