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1974 Supreme(Kar) 273
IN THE HIGH COURT OF KARNATAKA AT BANGALORE
G.K. Govinda Bhat and M.K. Srinivas Iyengar, JJ.
D.B. Navalgundkar and Co. —Appellant
Vs.
Commissioner of Income Tax, Mysore —Respondent
Income Tax Reference No. 42 of 1972
Decided on : 26-02-1974
Advocate Appeared:
Mr. C.N. Kumar, K. Srinivasan, for the Appellant
Mr. S.R. Rajasekhara Murthy, for the Respondent
The main legal point established in the judgment is that the Income Tax Officer is competent to levy penalty under section 271(1)(a) of the Income Tax Act, 1961, even when interest under section 139 has been charged.
Headnote:
Penalty - Income Tax - The court held that the Income Tax Officer was competent to levy penalty under section 271(1)(a) of the Income Tax Act, 1961, even when interest under section 139 has been charged. The court found that the two levies are not alternative and not cumulative, and upheld the constitutional validity of the provision for levy of penalty when interest is charged.
Fact of the Case:
The Income Tax Appellate Tribunal referred the question of whether the Income Tax Officer was competent to levy penalty under section 271(1)(a) of the Income Tax Act, 1961, when interest under section 139 has been charged.
Finding of the Court:
The court found that the Income Tax Officer was competent to levy penalty under section 271(1)(a) of the Income Tax Act, 1961, even when interest under section 139 has been charged. The court upheld the constitutional validity of the provision for levy of penalty when interest is charged.
Issues: The main issue was whether the Income Tax Officer was competent to levy penalty under section 271(1)(a) of the Income Tax Act, 1961, when interest under section 139 has been charged.
Ratio Decidendi: The court held that the two levies are not alternative and not cumulative, and that the Income Tax Officer is competent to levy the penalty even when interest has been charged under section 139.
Final Decision: The court answered the question referred in the affirmative and against the assessee, upholding the competence of the Income Tax Officer to levy penalty under section 271(1)(a) of the Income Tax Act, 1961, when interest under section 139 has been charged.
Govinda Bhat, C.J.—The Income Tax Appellate Tribunal, Bangalore Bench, has stated a case and referred for the opinion of thus court the following question of law :
"On the facts and circumstance of the assessee's case, when interest under section 139 has been charged whether the Income Tax Officer was competent to levy any penalty under section 271(1)(a) of the Income Tax Act, 1961 ?"
2. No further facts are necessary as the question referred in self-evident. The contention of the assessee is that when interest under section 139 of the Act has been charged, it is not commented for the Income Tax Officer to levy penalty under section 271(1)(a) of the Act. No Provisions of the Act has been brought to our notice which says that the two levies are alternative and not cumulative. When the Act does not state that where there is a levy under section 139, no penalty can be levied under section 271(1)(a) of the Act, the Income Tax Officer is competent to levy the penalty. That is also the view taken by the Andhra Pradesh High Court in T. Venkata Krishnaiah and Co. v. Commissioner of Income Tax. We are in respectful agreement with the opinion of the Andhra Pradesh High Court on the said question.
3. Before the Madras High Court, the constitutional validity of the provision for levy of penalty when interest is charged was challenged in Express Newspapers (P.) Ltd. v. Income Tax Officer. The challenged was repelled and the constitutional validity of the provisions of section 271(1)(a) was upheld.
4. Accordingly, we answers the question referred in the affirmative and against the assessee.
5. No costs.
6. Question answered in the affirmative.
