R.K.GULATI J. - (1.) THE Tribunal has referred the following question under S. 256(1) of the INCOME TAX ACT, 1961 ( here inafter referred to as "the Act" ) : "Whether on the facts and circumstances of the case, the Tribunal was legally correct in holding that the assessee, a registered firm, has to be treated as an unregistered firm for the purposes of levy of penalty under S. 271(1)(a) of the INCOME TAX ACT, 1961 ?"
(2.) THE assessee is a registered firm and was assessed to tax in that status. It was required to file its return of income for the asst. year 1976 -77 on or before 31st July, 1976. The return was, however,filed after a delay of seven completed months from the due date. The ITO initiated penalty proceedings under S. 271(1)(a) of the Act. After taking into consideration the explanation furnished by the assessee, the ITO held that the assessee had failed to make out a reasonable cause for the delay in furnishing its return. The ITO, therefore, subjected the assessee to a penalty of Rs. 8,120 being the amount, at the rate of 2 per cent. of the tax payable for each month of the default, treating the assessee as an unregistered firm. The order of imposition of penalty was upheld in appeal by the CIT(A.). On further appeal, the Tribunal allowed the appeal in part, inasmuch as it directed that the amount of penalty be determined after deducting the advance tax paid from the tax computed in the status of an unregistered firm.
(3.) ON the above facts, at the instance of the assessee, the Tribunal has referred the question set out earlier for the opinion of this Court.;