Dwarka Prasad Gupta, J. - (1.) A short question which arises in this reference is as to whether penalty is imposable with reference to law as obtaining on the date when the assessment order was passed and the penalty proceedings were initiated or whether the penalty is imposable with reference to the date of commission of default, namely, the date of filing of the original return. In this case, the Income-tax Officer while completing the assessment issued notice under Section 271(1)(c) of the Income-tax Act, 1961, to the assessee and penalty was imposed upon the assessee-firm on the ground that it furnished inaccurate particulars of its income or concealed the particulars of its income.
(2.) THE aforesaid question stands concluded by the decision of their Lordships of the Supreme Court in Brij Mohan v. CIT [1979] 120 ITR 1 and is no longer open to dispute. THEir Lordships of the Supreme Court held in the aforesaid case that when penalty is imposed for concealment of particulars of income, the law prevailing on the date on which the act of concealment takes place shall be applicable and it is wholly immaterial that the income concealed was to be assessed in relation to an assessment year in the past. THEir Lordships of the Supreme Court held that when penalty proceedings were initiated under Section 271(1)(c) of the Act, the case was to be decided in accordance with the law which was operative on the date on which the wrongful act was committed and when the return was filed which did not disclose the correct particulars of income or disclosed inaccurate particulars thereof, within the meaning of Section 271(1)(c) of the Act. As this matter stands concluded, the reference is answered in accordance with the decision of their Lordships of the Supreme Court in Brij Mohan's case [1979] 120 ITR 1 and we hold that penalty is imposable under Section 271(1)(c) of the Act with reference to the date on which the original return was filed, i.e., when the act of concealment took place. We are, therefore, of the view that the Appellate Tribunal was not justified in holding that penalty was imposable in accordance with law prevailing on the date of initiation of penalty proceedings. But as held by their Lordships of the Supreme Court, the relevant date for imposition of penalty is the date of filing of the original return by the assessee, as that was the date of commission of the offence within the meaning of Section 271(1)(c) of the Act. Thus, question No. 1 is answered in the negative, in favour of the assessee and against the Revenue, as the penalty is imposable in accordance with the law which was in force on the date of filing of the return. In view of our finding in respect of question No. 1, question No. 2 does not arise and has become redundant. The reference is answered accordingly.;