The question whether there is a reasonable cause for filing a delayed return is a pure question of fact and no question of law arises therefrom.

Pritam Singh Pattar and D.K.Mahajan JJ.

1. This order will dispose of Income-tax Cases Nos. 15 and 16 of 1972.

2. The Additional Commissioner of Income-tax, Haryana, Himachal Pradesh and Delhi (hereinafter called " the petitioner "), has made this application under Section 256(2) of the Income-tax Act, 1961, to direct the Income-tax Appellate Tribunal, Chandigarh Bench, Chandigarh, to refer the following question of law for the opinion of this court:

" Whether, on the facts and in the circumstances of the case, the Tribunal was justified in condoning the delay and in deleting the penalty levied under Section 271(1)(a) of the Income-tax Act, 1961 ? "

3. Both these cases relate to the same assessee, Roshan Lal Kuthiala. The assessee died during the pendency of these cases and by order dated March 12, 1973, his sons, Rajinder Lal Kuthiala and Ravinder Lal Kuthiala, and widow, Smt. Lila Devi, were brought on the record as legal representatives in both these cases. The Income-tax Case No. 15 of 1972 relates to the assessment year 1959-60 and the Income-tax Case No. 16 of 1972 relates to the assessment year 1960-61.

4. The facts of Income-tax Case No. 15 of 1972 are that for the assessment year 1959-60, the assessee did not file the return of income as required by Sub-section (1) of Section 22 of the Indian Income-tax Act, 1922, which under the law had to be filed by 1st July, 1959. A notice under Section 22(2) of the said Act was issued on September 5, 1959, but it came back unserved with the report by the postal authorities that the assessee had refused to receive it. No application for extention of time was filed by the assessee. On January 10, 1961, the Income-tax Officer addressed a letter to the assessee pointing out that he had failed to file the return under Section 22(1) of the said Act and if no return was filed by him within two days, he will be compelled to proceed to complete the assessment for the assessment year in question under Section 23(4) of the Act. The assessee was also called upon to show cause why penalty proceedings under Section 28 of the Act be not taken against him for his failure to file the return in time. The assessee did not send any reply to this letter, which was admittedly received by him while he was at Bangalore. Ultimately, the assessee filed his return on May 21, 1962, declaring his income as Rs. 3,21,752 subject to adjustment of loss in another partnership. Thus, this return was delayed by 34 months.

5. On June 18, 1962, a provisional assessment was made and the tax was assessed at Rs. 2,11,881, which was later on reduced to Rs. 1,62,378 after the loss figure from the partnership firm was known. The final assessment under Section 23(3) was completed by the Income-tax Officer on November 30, 1963, and after giving credit for the tax paid under the provisional assessment, a demand of Rs. 19,717 including penal interest was made. On appeal, the amount of tax was reduced to Rs. 87,444, which was less than the amount already paid by the assessee under the demand made in pursuance of the provisional assessment and the net result was that the assessee became entitled to the refund of Rs. 4,600.

6. In the meantime, by a notice issued under Section 271(1)(a), dated November 30, 1963, under the Income-tax Act, 1961, which was served on the assessee on December 9, 1963, the Income-tax Officer started penalty proceedings against the assessee for his failure to file the return within the prescribed time. The Income-tax Officer, Central Circle, Ambala, imposed a penalty of Rs. 43,722, vide his order dated November 23, 19.65, and this was 50 per cent. of the gross tax payable by the assessee in respect of his total income as finally computed for the assessment year. The assessee filed an appeal against this order before the Appellate Assistant Commissioner of Income-tax, "B" Range, Amritsar, who by his order, dated November 15, 1967, reduced the amount of penalty to Rs. 42,625 only. The assessee then