Satish Chandra, J. - (1.) THE Inspecting Assistant Commissioner, Kanpur, imposed on the assessee a penalty in the sum of Rs. 59,476, being the amount of income concealed, for the assessment year 1968-69. THE concealed income consisted of two items. One was dividend income of Rs. 24,750. This amount was declared as dividend by Messrs. Straw Products Ltd., Bhopal. THE declaration was made on June 29, 1966, and the warrant of dividend that was issued was dated August 8, 1967. THE assessee did not maintain regular accounts. He, however, maintained a memorandum book in which he entered this dividend income on March 13, 1969. THE assessee's accounting year for 1968-69 ended on March 28, 1968. It is thus evident that the declaration of dividend was made during the accounting year relevant to the assessment year 1968-69. THE warrant was also issued within that year.
(2.) THE other item related to special remuneration received by the assessee as director of Messrs. J. K. Industries (Private) Ltd., Kanpur. THE company, by a resolution dated September 19, 1967, sanctioned a special remuneration of Rs. 34,726 to the assessee. This remuneration was actually paid to the assessee on April 15, 1968. The assessee filed his return for the year 1968-69 on September 9, 1968. The assessment for this year was completed on February 27, 1969. The assessee filed his return for the year 1969-70 on October 4, 1969. These items of income were not shown in either of the two returns. During the course of proceedings for assessment for this year the assessee invited the attention of the Income-tax Officer to the fact that he had received the dividend and remuneration income aforesaid and he may tax it either in the year 1969-70 or 1968-69.
(3.) THE Income-tax Officer reopened the assessment for the assessment year 1968-69 and brought both these items to tax for that year. As the minimum penalty imposable was over Rs. 1,000, the Income- tax Officer referred the question of initiating penalty proceedings to the Inspecting Assistant Commissioner.;