R.K. Gulati, J.
1. At the instance of the Revenue under Section 256(1) of the Income-tax Act, 1961, the following question of law has been referred for the opinion of this court :
'Whether, on the facts and circumstances of the case, the Appellate Tribunal was justified in holding that the Inspecting Assistant Commissioner had no jurisdiction to levy penalty under Section 271(l)(c) of the Income-tax Act, 1961, after April 1, 1976 ?'
2. The controversy involved in the aforesaid question is where the penalty proceedings were initiated by the Income-tax Officer for the concealment of income under Section 271(l)(c) of the Income-tax Act, 1961, before the enforcement of the Taxation Laws (Amendment) Act, 1975, which came into effect from April 1, 1976, and the Inspecting Assistant Commissioner levied penalty on a reference being made to him under Sub-section (2) of Section 274, after April, 1, 1976, i.e., after the deletion of sub-section (2) of Section 274, whether such a penalty order could in law be sustained. A similar controversy was decided by a Division Bench of this court in CIT v. Om Sons : [1979]116ITR215(All) , where it was held that a court or Tribunal deciding a matter must not only be possessed of jurisdiction initially but also be clothed with the power to decide the matter when the final order is passed. Thus, as on the date when the Inspecting Assistant Commissioner passed the final order, his jurisdiction to do so had been taken away by the amendment of Section 274(2) of the Act, the order passed by him was without jurisdiction. The decision in the above case has been followed by this court in a number of other cases involving a similar controversy. A reference in this connection may be made to CIT v. Jagannath Prasad Nankoo Prasad : [1987]168ITR52(All) and CIT v. Lal Chand Jain : [1989]180ITR448(All) to which one of us (R. K. Gulati J.) was a party. The view expressed in this case was as under (headnote of 180 ITR) :
'Held, that as, on the date when the Inspecting Assistant Commissioner passed his final order, his jurisdiction to do so had been taken away by the amendment of Section 274(2), the order passed by the Inspecting Assistant Commissioner was without jurisdiction. The legislative intention was to destroy the continuance of the power of the Inspecting Assistant Commissioner even in respect of matters which had already been referred to him by the Income-tax Officer prior to April 1, 1976, and the Inspecting Assistant Commissioner had no jurisdiction to pass the penalty order under Section 271(l)(c) on or after April 1, 1976, and the proper authority who had jurisdiction to deal with the matter of imposition of penalty was the Income-tax Officer.'
3. Following the view taken in the aforesaid case, with which we are bound, we hold that the Inspecting Assistant Commissioner had no jurisdiction to pass the penalty order after the amendment of the Taxation Laws (Amendment) Act, 1975, with effect from April 1, 1976, even though the proceedings for levy of penalty were initiated before the coming into force of the Amendment Act. We, accordingly, answer the question referred to us in the affirmative, in favour of the assessee and against the Department. There shall be no order as to costs.