Sen, J. - (1.) In this reference, at the instance of the Commissioner of Income-tax, West Bengal-II, Calcutta, the Tribunal, under Section 256(1) of the I.T. Act, 1961, has drawn up a statement of case and referred the following question as a question of law arising from its order : "Whether, on the facts and in the circumstances of the case, and in particular of the fact that the assessee's petition to the Commissioner of Income-tax under Section 271(4A) of the Income-tax Act, 1961, was still pending with the Commissioner when order under Section 271(1)(c) was passed by the Inspecting Assistant Commissioner of Income-tax, the Tribunal was right in coming to the conclusion that provisions of Section 271(1)(c) were not attracted ?"
(2.) The facts found and/or admitted in these proceedings may shortly be stated as follows. Sarda Rice & Oil Mills, the assessee, is a partnership firm. On the 30th April, 1966, the assessee filed a petition under Section 271(4A) of the I.T. Act, 1961, admitting, inter alia, that during the assessment years 1960-61 to 1966-67, it had earned additional business income of Rs. 2,32,509 which had not been disclosed and included in its assessments and offered a sum of Rs. 2,30,168 for taxation in the assessment years 1960-61 to 1965-66, the balance to be included in the return for the year 1966-67, not filed up till then.
(3.) The ITO reopened the assessments for the years 1959-60 to 1961-62. The assessee filed revised returns for the assessment years 1963-64 to 1965-66. For the other years returns had already been filed before the ITO. In the reassessment, the ITO added certain amounts to the income of the assessee as income from other sources on the basis of the said disclosure petition. The ITO also initiated penalty proceedings and, as the minimum penalty imposable according to him exceeded Rs. 1,000, he referred the matter to the IAC.;