1. This reference under section 256(1) of the Income-tax Act, 1961, is at the instance of the Revenue to decide the following question of law :

" Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the Inspecting Assistant Commissioner had no jurisdiction to levy the impugned penalty under section 271(1)(c) ? "

2. The relevant assessment year is 1972-73.

3. The assessee is an individual. The Income-tax Officer completed the assessment on March 22, 1975, assessing the total income at Rs. 51,747 making an addition therein of Rs. 36,000 as " income from undisclosed sources ". The Income-tax Officer also initiated penalty proceedings under section 271(1)(c) of the Act and referred the matter to the Inspecting Assistant Commissioner in view of the fact that the penalty leviable exceeded the jurisdiction of the Income-tax Officer. The Inspecting Assistant Commissioner after hearing the assessee imposed a penalty of Rs. 23,400 by his order dated January 17, 1977. The assessee's appeal to the Tribunal succeeded. The Tribunal accepted the contention that the Inspecting Assistant Commissioner had no jurisdiction to impose the penalty b