D.B Navalgundkar & Co. v. Commissioner Of Income-Tax, Mysore.

Govinda Bhat, C.J:— The Income-tax Appellate Tribunal, Bangalore Bench, has stated a case and referred for the opinion of this court the following question of law:

“On the facts and circumstances 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 is self-evident. The contention of the assessee is that when interest under section 139 of the Act has been charged, it is not competent for the Income-tax Officer to levy penalty under section 271(1)(a) of the Act. No provision 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 [1974] 93 ITR 297 AP.. 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 [1973] 88 ITR 255 Mad.. The challenge was repelled and the constitutional validity of the provisions of section 271(1)(a) was upheld.

4. Accordingly, we answer the question referred in the affirmative and against the assessee.

5. No costs.

6. Question answered in the affirmative.