S.D. Agarwala, J. - (1.) At the instance of the Commissioner of Income-tax, Allahabad, this reference has been made. The following question has been referred for our opinion : "Whether, on the facts and circumstances of the case, the Appellate Tribunal was correct in law in holding that the Inspecting Assistant Commissioner had no jurisdiction to levy penalty under Section 271(1)(c) of the Act after April I, 1976 ?"
(2.) M/s. Jagannath Prasad Nankoo Prasad, the assessee, filed a return declaring an income of Rs. 47,605. The Income-tax Officer, however, assessed the income at Rs. 83,708. On appeal, the Tribunal reduced the income to Rs. 54,111. On February 22, 1974, the Income-tax Officer initiated proceedings against the assessee under Section 271(1)(c) of the Income-tax Act, 1961, hereinafter referred to as "the Act". The Income-tax Officer was of the opinion that the assessee had concealed the particulars of his income and had furnished inaccurate particulars of such income and consequently was liable to pay penalty. Since the amount of income alleged to have been concealed by the assessee exceeded Rs. 25,000, the Income-tax Officer referred the case to the Inspecting Assistant Commissioner under Section 274(2) of the Act for the purpose of imposition of penalty.
(3.) Section 274(2), as it then stood, was in the following terms : "(2) Notwithstanding anything contained in Clause (iii) of Sub-section (1) of Section 271, if in a case falling under Clause (c) of that Sub-section, the amount of income (as determined by the Income-tax Officer on assessment) in respect of which the particulars have been concealed or inaccurate particulars have been furnished exceeds a sum of twenty-five thousand rupees, the Income-tax Officer shall refer the case to the Inspecting Assistant Commissioner who shall, for the purpose, have all the powers conferred under this Chapter for the imposition of penalty.";