LexTIWARI KANAHAIYALAL ETC. versus THE COMMISSIONER OF INCOME TAX, DELHI
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TIWARI KANAHAIYALAL ETC.
v.
THE COMMISSIONER OF INCOME TAX, DELHI
March 13, •I 975
[A. ALAGIRISWAMI AND N. L. UNTWALIA, JJ.]
927
i11co111e-tax Act ( 11 of 1922), ss. 28 w1d 52, Income-tax Act (43 of 1%1),
ss. 271, /77 and 297 ancl Gmera/ C/(111.\<'s Act (10 of 1897) s. 6 (c)-False de-
c/aratio11 filed by assessee under 1922 Act-Penalty imposed under 1961 Act-
Prmecution for false declaration under s. 52 of 1922 Act-ft valid.
.
Sec lion 297 (2) (f) of the Indian Income-tax Act, 1961, provides that not-
withstanding the repeal of the Income-tax Act, 1922, any proceeding for the im-
position of a penalty in respect of any assessment completed before April 1,
1962, may be initiated 'as if the 1961 Act had not been passed; and Clause (g)
provides that any proceeding for the imposition of a penalty in respect of any
assessment for the year ending March 3 l, 1962, or any earlier year, which was
completed 011 01 after April 1, 1962 may be initiated under the 1961 Act. Section
28(4) of the 1922 Act provides that no prosecution for an offence against the
1922 Act shall be instituted in respect of the same facts on which a penalty has
been imposed undCJ the section.
The appellant, filed returns under s. 22(2), Income-tax Act, 1922, the last of the
returns being for the assessment year 1959-60. In 1964, he filed revised returns
for the same assessment years showing a larger income.
The income-tax was
~1ssessed under the 1961 Act on the revised returns and penalty proceedings were
instituted and penalty was levied.under s. 271 of the 1961 Act. The respondent,
thereafter, filed complaints for offences under s. 277 of the 1961 Act. By way
of abundant caution he alsc filed complaints on the same facts for offences under
s. 52 of the f922 Act. The trial court held that the launching of prosecution was
illegal in view of s. 28 ( 4) of th~ 1922-Act and Art. 20 ( l) of the Constitution.
The High Court, in appeal~ held that since no penalty was imposed under 6. 28
of the 1922 Act, s. 28 ( 4) was not a bar to the institution of proserntion nor \\'as
it hit by Art. 20(1), and directed the trial court to proceed with the trial.
Dismissing the appeal to this Court,
HELD : (l) All the assessments although they related to the years .::arlier
than the year ending on March 31. J 962, and were completed after the coming
into force of the 1961-Act. (April, 1962). Hence the proceeding for the imposi-
tion of penalty had to be and was initiated under the 1961 Act under s. 297(g).
Therefore, s. 28(4) of the 1922 Act cannot be a bar as no penalty was imp.1sed
under s. 28o1and there is no provision similar to s. 28(4) in the 1961 Ad. [5>30
A-Bl
Jain Bros & Others v. The U11io11 of llldia & others [1970] 3 S.C.R. 253.
fol-
lowed.
(2) Article 20(1) docs not help the appetlant. lt is not a post facto legi~lation
that is being pressed against him. Section 28 ( 4) did not obliterate the commis-
sivn of the offence or convert the offence into an innocent act.
Under the sec-
tion, the imposition of penalty merely barred the prosecution. But in the present
case, the penalty having been imposed under s. 271 of the 1961 Act the launching
of prosecution became permissible and was not hit by Art. 20(1). [931 DJ
Rao Shir Balrndur Singh and a11otlicr v. Tile State of Vi11clllya Prade>il {1953]
S.C.R. 1188. followed.
(3) (a) On the facts alleged, '.f true. the appellant would be guilty of an offence
under s. 52 of the 1922-Act. Section 297(1) of the 1961-Act repealed the 1922-
Act. Jn s. 297(2) there is no saving for launching a prosecution under s. 52
of the 1922-Act. But since no intentinn different frnm that in s. 6 of the General
Clauses Act, 1897, appears ins. 297(2) of the 1961-Act, the criminal liability in-
curred under s. ~2 of the 1922 Act remains unaffected under s. 6(c) of the General
928
SUPREME COURT REPORTS
f1975J 3 s.c.R.
Clauses Act. The prosecution c'an only be for tlie offence under s. 52 of the
1922-Act ands. 277 of the 1961 Act, which corresponds to s. 52 of the 1922-Act,
cannot be invoked, [93 J G-H]
c b) The ;ippcllant would also be entitled lo rely on the second part of Art.
20 (I ) that he should nol be subjected to a penalty ::;realer than that which might
have been inflicted under the Jaw in force at the time of the commission of the
offence. Is. 52 of the 1922 Act), because, s. 277 of the 1961-Act, corresponding
to s. 52 of the 1922 Ac:t, provides a greaterExcerpt shown. Read the full judgment & AI analysis in Lexace.