Saberaj Industries vs F.J. Bahadur, Commissioner of Income Tax and another

S.H. Kapadia, J.—Being aggrieved by order dated January 28, 1987, passed by the Commissioner of Income Tax rejecting the petitioners'' application u/s 273A of the Income Tax Act, 1961, for waiver of interest and penalty in respect of the assessment years 1978-79 up to 1982-83, the present writ petition has been filed.

The facts giving rise to this petition briefly are as follows :

On November 15, 1985, the petitioners filed returns of income for eight years in respect of the assessment years 1978-79 up to 1985-86. According to the petitioners, they filed the above returns of income for eight years disclosing voluntarily their true income and also paid self-assessment tax thereon. However, the said returns for the first five years out of eight years, i.e., for the assessment years 1978-79 up 1982-83, were filed beyond time. On January 22, 1986, and on January 30, 1986, notices u/s 148 of the Income Tax Act came to be issued in respect of the abovementioned first five years. By letters dated January 28, 1986, and January 31, 1986, the petitioners informed the Income Tax Officer that they were in receipt of notices u/s 148; that they have filed returns for eight assessment years on November 15, 1985, and, in the circumstances, the petitioners requested the Income Tax Officer to treat the said returns as filed in compliance with the notice u/s 148. The assessment for the relevant assessment years came to be completed u/s 143(1) of the Income Tax Act on September 3, 1986. Thereafter, the petitioners applied on November 19, 1985, for waiver of interest and penalty imposed by the Income Tax Officer at the time of assessment. By the impugned order, the said application is rejected by the Commissioner of Income Tax on the ground that the returns of the above five years were filed beyond the time limit as prescribed under the Act, and, therefore, the returns were treated as non est in the eye of law. Accordingly, the petitioner''s claim for the first five years of waiver was rejected. However, for the last three years, viz., assessment year 1983-84 up to assessment year 1985-86, the Commissioner waived the interest and penalty and directed the Income Tax Officer to carry out his directions. Being aggrieved by the order of rejection in respect of the first five assessment years, the present writ petition has been filed. Shri Bhujale, learned counsel for the petitioners, contended that in the instant case, returns were filed on November 15, 1985, whereas notices u/s 148 were issued in January, 1986, and, therefore, the petitioners had filed their returns and had disclosed their full and true income voluntarily and in good faith before the notice u/s 139(2) or section 148 of the Income Tax Act was issued and, therefore, the petitioners had complied with all the conditions u/s 273A of the Income Tax Act. Shri Bhujale further contended that the Commissioners of the Income Tax had erred in coming to the conclusion that the returns were filed in pursuance of notice u/s 148. Shri Bhujale contended that the Commissioner of Income Tax erred in coming to the conclusion that the returns filed by the petitioners in 1985 did not fall under sections 139(1), 139(3) and 139(4) and, therefore, the said returns were no returns in the eye of law.

The basic question involved in the present case is whether the petitioners had filed their returns before notice u/s 148 was issued. The petitioners have solemnly affirmed in the petition that they filed their returns much prior to issuance of the notice u/s 148 in January, 1986. However, in the present case, we find that by letters dated January 28, 1986, and January 31, 1986, the petitioners informed the Income Tax Officer that they were in receipt of notice u/s 148 and that the petitioners requested the Income Tax Officer to treat their returns filed on November 15, 1985, as returns filed in compliance with the notice u/s 148. This clearly shows two things, firstly, that the returns filed on November 15, 1985, in respect of the assessment years 1978-79 up to 1982-83 were filed beyond the time limit prescribed. Secondly, the letters dated January 28, 1986, and January 31, 1986, addressed by the petitioners to the Income Tax Officer indicate that the petitioners purported to file returns after notice u/s 148. Shri Bhujale contended that the above two letters dated January 28, 1986, and January 31, 1986, only indicate that the returns were filed on November 15, 1985, i.e., prior to notice u/s 148. There is no merit in the said contention. The above two letters dated January 28, 1986, and January 31, 1986, indicate clearly that the petitioners purported to request the Income Tax Officer to treat the returns which were time-barred, to be treated as returns in compliance with section 148 of the Income Tax Act. In the above circumstances, the pre-conditions laid down by section 273A of the Income Tax Act, are not fulfilled. In the above circumstances, it is not necessary for this court to go into the larger issues raised by the petitioners in the petition. One more aspect may be mentioned : that the Commissioner of Income Tax has given a finding of fact that only the returns for the last three assessment years out of the eight assessment years are true and complete. This is essentially a finding of fact. In the circumstances, we do not wish to interfere under article 226 of the Constitution.

Accordingly, the writ petition fails; rule is discharged with costs.