Lajpat Rai (Huf), Faridabad v. The Commissioner Of Income Tax, Haryana,Rohtak And Another

Civil Writ Petition No.12917 of 1991 IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH (1) Civil Writ Petition No.12917 of 1991 Date of Order: 03.09.2013 Lajpat Rai (HUF), Faridabad ...Petitioner Versus The Commissioner of Income Tax, Haryana,Rohtak and another. ..Respondents (2)Civil Writ Petition No.13191 of 1991 Satya Pal ...Petitioner Versus The Commissioner of Income Tax, Haryana,Rohtak and another. ..Respondents CORAM: HON'BLE MR. JUSTICE RAJIVE BHALLA HON'BLE MR. JUSTICE DR. BHARAT BHUSHAN PARSOON Present:Mr. Anand Chhibbar, Senior Advocate withMs. Supriya Garg, Advocatefor the petitioner. Mr. Yogesh Putney, Advocate,for the respondents. RAJIVE BHALLA, J (Oral) By way of this order, we shall dispose of Civil Writ PetitionNos.12917 and 13191 of 1991, as they involve adjudication of thesame questions of fact and law. Facts, necessary for adjudication ofthe writ petitions are being taken from Civil Writ Petition No.12917 of1991. Counsel for the petitioner submits that as in assessment year 1979-80, the petitioner was not liable to file return with respectto income, in accordance with Section 80(J)(3) of the Income Tax Act,1961 (hereinafter referred to as 'the Act'), the imposition of penalty isnot warranted. Section 80(J)(3) of the Act was introduced byFinance Act No.2 of 1980 with retrospective effect from 01.04.1972.The petitioner was of a bonafide belief that in view of pendency ofchallenge to the vires of Section 80J of the Act, before the HighCourt, he was not required to file a return. The penalty and interestmay, therefore, be waived. Mr. Yogesh Putney, Advocate, for the respondents,submits that as Section 80(J)(3) was amended by Finance Act No.2of 1980 with effect from 01.04.1972, the petitioner cannot take anybenefit and, therefore, has rightly been directed to pay penalty. Theorder passed by the Assessing Officer as well as the revisionalauthority are legal and valid and should, therefore, be affirmed. We have heard counsel for the parties, perused theimpugned orders and find no reason to interfere with the impugnedorders. The petitioner having failed to discharge his statutory obligation to file a return, a penalty was proposed to be levied. TheAssessing Officer, vide order dated 31.03.1989 imposed penalty. Anextract from the order reads as follows:- “Notice u/s 274 read with section 273 of the Actrequiring the assessee to show cause as to why anorder imposing a penalty should not be made wasissued and it was duly served upon the assessee. The assessee was provided with a fresh opportunityof hearing under this office letter dated 2.8.1988and 9.12.1988. In response to these letters ShriJ.L.Mamhotra, CA attended the proceedings andthe hearing was adjourned to 27.1.1989 at hisrequest. No body attended on this date nor anywritten reply has been received so far. Perusal ofthe record shows that the assessee main source ofincome is one-half share from M/s Haryana SteelFabricator, Faridabad, in which he is a partner. It isalso noticed that the return in the case of the firmwas received on 30.09.1979 and the assessmentwas made on total income of Rs.91,580/- u/s 143(3)of the Income Tax Act, 1961 vide assessment orderdated 21.1.1981. Despite this, the assessee did notfile his return and ultimately proceedings u/s 141were initiated and notice u/s 148 was served uponthe assessee on 18.09.1984. In thesecircumstances, I hold that the assessee had withoutreasonable cause failed to furnish his return ofincome within time. I, therefore, direct theassessee to pay a sum of Rs.23,260/- (Rs. Twentythree thousand two hundred & sixty only) by way ofpenalty as per following calculations:-Total tax payable: Rs.18,759Return late by 62 Civil Writ Petition No.12917 of 1991 complete months, penalty imposed @ 2% : Rs. 23,260per month. Civil Writ Petition No.12917 of 1991 complete months, penalty imposed @ 2% : Rs. 23,260per month. Demand notice and challan shall be issued.” The revision filed by the petitioner was also dismissed.The petitioner's plea relating to ignorance of the affect of Section 80Jof the Act or the pendency of a matter relating to vires of Section 80Jof the Act may have been accepted, if the petitioner had offered anexplanation before the Assessing Officer. The petitioner did notappear before the Assessing Officer to offer any explanation and,therefore, cannot be allowed to raise a fresh plea in proceedingsunder Article 226 of the Constitution of India. The Assessing Officerand the revisional authority have dealt with the petitioner's defaultand the lack of bonafides. We find no reason to hold that orderspassed by the Assessing Officer or the revisional authority sufferfrom any error of jurisdiction or of law as would require interference. Dismissed. (RAJIVE BHALLA)JUDGE September 03, 2013 (DR. BHARAT BHUSHAN PARSOON)nt JUDGE