JUDGMENT

Pathak, J. - At the instance of the Commissioner of Income Tax, the following question has been referred by the Income Tax Appellate Tribunal:

"Whether, on the facts and in the circumstances of the case, the proceedings for imposition of penalty u/s 271(1)(c) had been validly commenced within the meaning of Section 275 of the Income Tax Act, 1961 ?"

2. Proceedings for the imposition of penalty were taken against the assessee for concealment of income represented by cash credit entries in the accounts of four creditors during the previous year relevant to the assessment year 1963-64. The Inspecting Assistant Commissioner examined the four creditors and upon the material before him held that the explanation submitted by the assessee in respect of the cash credit entries was false. He imposed a penalty of Rs. 28,070. In appeal before the Income Tax Appellate Tribunal, the assessee contended that the penalty proceedings had not been commenced during the course of the assessment proceedings and were, therefore, invalid. The Tribunal accepted the plea and allowed the appeal.

3. According to the facts found by the Tribunal, the assessment was completed on November 30, 1963. In the or