The authority competent to impose penalty is determined by the law as it stood on the date when the penalty is imposed, not on the date of concealment.

Rama Jois, J.—The Income Tax Appellate Tribunal, Bangalore Bench, has referred the following question of law for the opinion of this court :

"Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in holding that the Income Tax Officer had no jurisdiction to levy penalty u/s. 271(1)(c) for the assessment year 1968-69 notwithstanding the amendment of section 274(2) by the Taxation Laws (Amendment) Act, 1970, with effect form April 1, 1971 ?"

2. The assessee is the same in both the references. The assessment years are 1968-69 and 1969-70. The Income Tax returns were filed by the assessee on July 27, 1968, and July 24, 1969, respectively. The assessments were finalised on the said basis. Subsequently, the assessments were reopened. Notices under s. 148 of the I.T. Act, 1961 (hereinafter referred to as "the Act"), were issued to the assessee on January 6, 1970. The revised returns were filed by the assessee on March 4, 1970.

3. At this stage, it is necessary to refer to the relevant provisions of the Act. Under sub-s. (2) of s. 274 of the Act as it stood on the above dates, the ITO had to refer all cases of penalties in which the minimum penalty imposable under s. 271(1)(c) of the Act was above Rs. 1,000 to the IAC. The above provision was amended by the Taxation Laws (Amend.) Act, 1970, with effect from April 1, 1971. After this amendment, the ITOs were competent to impose penalties in all cases where the concealment of income did not exceed Rs. 25,000. They were required to refer only such cases of concealment of income where the amount concealed exceeded a sum of Rs. 25,000 to the IACs. After the amendment of Sub-s. (2) of s. 274 of the Act as stated above, the reassessment orders were made by the ITO on December 24, 1971. He imposed the penalty of Rs. 10,880, for the assessment year 1968-69 and a sum of Rs. 15,457 for the assessment year 1969-70. Aggrieved by these orders, the assessee preferred appeals to the AAC. The appellate authority set aside the order holding that the authority competent to impose penalty was the authority who was competent to impose penalty as on the date of concealment. On this basis, the AAC held that it was the IAC who was competent to impose the penalty and not the ITO. On appeal by the department, the Appellate Tribunal confirmed the view taken by the AAC. Thereafter, on the application made by the commissioner, this reference has been made.

4. Sri S. R. Rajasekhara Murthy, learned counsel appearing for the commissioner, submitted that by the time the penalty notices were issued and the penalty was imposed, sub-s. (2) of s. 274 of the Act had already been amended and according to the amended provision the ITO was competent to impose the penalty in all cases where the concealment did not exceed Rs. 25,000. He, therefore, submitted that as in these cases the concealment was less than Rs. 25,000 for both the years, the ITO was well within his jurisdiction in passing the orders imposing penalty. Sri Sarangaan learned counsel appearing for the assessee, however, submitted that it is the date of concealment which decides the jurisdiction of the authority to impose penalty. This submission is made on the analogy that as it is well settled that the quantum of penalty imposable should be determined according to the law as it stood on the date of concealment, so also the power or jurisdiction of the authority to impose the penalty should also be decided with reference to the law as it stood on the date of concealment. In support of this submission, learned counsel relied on a decision of the Madras High court in Continental Commercial Corporation Vs. Income-tax Officer and Anr., (1975) 100 ITR 170 Mad. In the said case, the Madras High Court held that the authority competent to impose penalty as on the date of concealment alone was competent to impose penalty even after the amendment of sub-s. (2) of s. 274 of the Act. We are unable to agree with the contentio