N.D.OJHA, J. - (1.) THE following question has been referred to this Court for its opinion by the Tribunal, Allahabad : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that S. 274 (2) is procedural and not substantive thereby confirming the penalties imposed by the ITO for the asst. yrs. 1966-67 to 1969-70 ?"
(2.) THE facts in a nut shell for deciding the aforesaid question are that the assessee submitted his return in respect of the relevant assessment years before 1st April, 1971. The assessments were completed on the basis of those returns. However, subsequently the assessments were reopened and the assessee filed revised returns in 1972. Revised assessment orders were passed in the same year 1972. Subsequently, penalty proceedings were initiated. Orders imposing penalty were passed by the ITO in the years 1974 and 1975. Sec. 274 (2) of the IT Act, 1961 had been amended w.e.f. 1st April, 1971 by the Taxation Laws (Amendment) Act of 1970. The effect of this amendment was that the jurisdiction of the IAC to impose penalty was taken away w.e.f. the date of the commencement of the Act namely, 1st April, 1971. The case of the assessee was that since the original returns were filed prior to 1st April, 1971 the amendment of S. 274 (2) of the Act which was in the nature of a procedural provision had no bearing on the case of the assessee and it is that law which was applicable at the time when the original returns were filed which would apply to the facts of the instant case. According to him since at that time jurisdiction to impose penalty in a sum exceeding Rs. 1,000 vested only with the IAC and not with the ITO, it is the IAC who notwithstanding the amendment of S. 274 (2) of the Act by the Amendment Act of 1970 continued to have jurisdiction the instant case and the orders of penalty having been passed not by him but by the ITO were without jurisdiction. Having heard counsel for the parties we find it difficult to agree with the submission made by counsel for the assessee. The effect of the amendment of S. 274 (2) of the Act by the Amendment Act of 1970 was that jurisdiction to impose penalty up to a sum of Rs. 25,000 was vested, w.e.f. 1st April, 1971, in the ITO and the IAC was divested with this jurisdiction. The matter came up for consideration before Division Bench of this Court in CIT vs. Om Sons. 1978 CTR (All) 407 : (1979) 116 ITR 215 (All). It was, after construing the provisions of S. 274 (2) of the Act as amended by the Amendment Act of 1970, held that if on the date when the IAC passed his final order imposing penalty his jurisdiction to do so had been taken away by the amendment of S. 274 (2) the order passed by him would be without jurisdiction. Counsel for the assessee has placed reliance on decision of certain other High Courts where a contrary view has been taken. Since, however, we are bound by the decision of a Division Bench of this Court in the case of Om Sons (supra) it is not possible for us to take a contrary view. At this place we may point out that some other High Courts have followed the view taken by this Court in the case of Om Sons (supra). It may further be pointed out that it is settled law that no one has a vested right in the forum. The assessee cannot claim to have a substantive right to have the penalty proceedings finalised by a particular officer notwithstanding the fact that the jurisdiction of that officer has by a statutory provision been taken away before final orders could be passed in the penalty proceedings.
(3.) COUNSEL for the assessee placed reliance on a decision of the Supreme Court in Brij Mohan vs. CIT (1979) 12 CTR (SC) 198 : (1979) 120 ITR 1 (SC). Suffice it to say so far as this case is concerned that it was a case dealing with the quantum of penalty and not with the jurisdiction of an officer who was competent to pass an order of penalty. The said case, in our opinion, is clearly distinguishable.;