Sabyasachi Mukharji, J.
1. For the three assessment years under reference, 1955-56, 1956-57 and 1961-62, the original assessments were made by the Income-tax Officer, under section 23(3) of the Indian Income-tax Act, 1922. Later, the ITO reopened the assessments and brought to tax certain amounts on the ground that the amounts had escaped assessment under the original assessments. The amounts thus brought to tax were Rs. 7,700 for the assessment year 1955-56, Rs. 38,500 for the assessment year 1956-57 and Rs. 7,000 for the assessment year 1961-62. These amounts brought to tax were said to be dividend income of the assessee in respect of 15,400 equity shares of M/s. Jute Carriers (P.) Ltd. standing in the names of 12 persons. As per the settlement with the department in the year 1964-65, the assessee agreed that those 15,400 shares standing in the names of 12 persons might be treated as his shares for the purpose of assessment in its hands of the money invested for the purchase of those shares. The assessee had opposed the reassessments bringing to tax the amounts representing the dividends in respect of the aforementioned 15,400 shares, inter alia, on the ground that the company did not pay the dividend in respect of those shares either to himself or to the 12 persons who were the nominees of the assessee and that the dividend was ultimately forfeited and also on the ground that the dividends were declared prior to the settlement entered into by the assessee with the department. The assessee's objection was overruled and the amounts in question were brought to tax by the reassessment orders. In the course of the reassessment proceedings, the ITO initiated penalty proceedings also against the assessee for the latter's failure to disclose in his returns the dividend income in respect of the 15,400 shares of M/s. Jute Carriers (P.) Ltd. The IAC, to whom the matter was referred by the ITO for further action, overruled the objections of the assessee and passed orders under section 271(1)(c) read with Section 274(2) of the LT. Act, 1961, levying upon the assessee penalties of Rs. 10,000, Rs. 50,000 and Rs. 10,000 for the assessment years 1955-56, 1956-57 and 1961-62, respectively. Aggrieved by the penalty orders, the assessee preferred appeals before the Tribunal. It was contended that the penalty orders were barred inasmuch as these were not passed within the period under section 275 of the LT. Act, 1961, as it stood before its amendment. But it is not disputed that when the amendment came into effect, that is to say, on 1st March, 1971, by virtue of the T.L. (Amendment) Act, 1970, the limitation had not expired and the amendment enlarged the period of limitation. Therefore, the Tribunal overruled this objection. Another contention was that the IAC did not consider about the receipt of the income. There was no question of evidence of non-disclosure of income by the assessee for which penalty could be imposed. The Tribunal, however, for the reasons mentioned in the earlier assessment orders, held, inter alia, as follows :
' After carefully considering the rival submissions of the learned representatives for the assessee as well as for the department, we are of the view that this is a fit case for the imposition of penalty. It can be gathered from the orders of the lower authorities that the assessee was the moving spirit behind the affairs of M/s. Jute Carriers (P.) Ltd. No doubt, the dividends were forfeited by the company some time in July, 1964, but we do not understand as to why the shareholders, who were legally entitled, to receive the dividend income, did not take any action whatsoever to encash the dividends in time. Further, there is no evidence on record that the shareholders had, in fact, filed a suit against the said company for recovery of the dividend income. It is difficult to believe for a shareholder, who is at all interested in the affairs of the company, to remain quiet and accept the resolution of forfeiture without any demur. Again, it is pertinent to note that the disclosure petition was made by the assessee only after the reassessment proceedings were started by the Income-tax Officer. As stated above, the notices under section 34(1)(a) of the 1922 Act were served on the assessee on 16th March, 1962, while the terms of settlement were arrived at some time on 14th January, 1965. Thus, the detection of the concealed income was made by the ITO much before the settlement petition filed by the assessee. In these peculiar circumstances of the case, we do not think that the assessee could get any support from the decision of Anwar Ali's case : [1970]76ITR696(SC) , decided by the Supreme Court and relied on by the learned representative for the assessee. However, we are satisfied that the penalty should have been imposed as per the law, which was in force prior to the amendment made by the Finance Act, 1968, as the amendment made by the Finance Act, 1968, does not relate to purely procedural matter but affects the right of an assessee [CIT v. Scindia Steam Navigation Co, Ltd. : [1961]42ITR589(SC) and Karimtha-ruvi Tea Estate Ltd. v. State of Kerala : [1966]60ITR262(SC) ]. In view of this, we direct the ITO to levy a penalty of 30% on the tax sought to be avoided for the three years under appeal. In any event, 'the penalty to be worked out should not exceed Rs. 4,000, Rs. 6,000 and Rs. 800 for the assessment years 1950-51, 1952-53 and 1954-55, respectively. '
2. Upon this, under section 256(1) of the I.T. Act, 1961, two questions were referred to this court. The said questions are as follows :
'(1) Whether, on the facts and in the circumstances of the case, the Tribunal was correct in holding that the imposition of penalty for the assessment years 1955-56, 1956-57 and 1961-62 was not barred by limitation under the provisions of Section 275 of the Income-tax Act, 1961
(2) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the non-inclusion of the dividend payable in respect of the 15,400 shares of Jute Carriers (P.) Ltd. in the returns filed for the assessment years 1955-56, 1956-57 and 1961-62 amounted to concealment of particulars of income attracting the provisions of Section 271(1)(c) of the Income-tax Act, 1961 '
3. In view of the decision of the Supreme Court in the case of S. C. Pra-shar v. Vasantsen Dwarkadas : [1963]49ITR1(SC) , the first question, referred to this court must be answered in the affirmative and in favour of the revenue.
4. So far as the second question is concerned, counsel for the assessee drew our attention to the observations of the Supreme Court in the case of J. Dalmia v. CIT : [1964]53ITR83(SC) and to the observations of this court in the case of CIT v. Jalan Investment (P.) Ltd. : [1976]103ITR198(Cal) and contended that prior to 1960 the dividend income was assessable under the provisions of Section 16(2) of the Indian I.T. Act, 1922, on the basis of receipt of such income. Therefore, at least for two years involved in this reference, as the amounts in question had not been received as income by the assessee, there was no offence and there could be no offence of non-disclosure of particulars of such income and as such there was no case for imposing penalty in respect of those years. The, Tribunal has set out the facts of this case. The Tribunal seems to have proceeded on the basis that the company by which these dividends were declared was the company managed and controlled by the assessee himself. The Tribunal came to the conclusion that the non-receipt was manoeuvred and arranged by the assessee. In that background and in the facts of this case, it cannot be said that such a finding was wholly unjustified. Indeed, such a finding has not been challenged. If in that background, the Tribunal has come to the conclusion that the assessee was guilty of offence of concealment of particulars of income, in our opinion, that finding of the Tribunal cannot be said to be bad in law. After all, whether in a particular case there has been concealment of particulars of income would depend upon the facts and circumstances of each case as observed in the case of CIT v. Ashoka Marketing Ltd. : [1976]103ITR543(SC) . In that view of the matter, the second question must also be answered in the affirmative and in favour of the revenue.
5. In the facts and circumstances of this case, the parties will pay and bear their own costs.
Guha, J.
6. I agree.