JUDGMENT
THANIKKACHALAM, J. :
At the instance of the assessee, the Tribunal referred the following two questions for the opinion of this Court under S. 256(1) of the Act :
“1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in confirming the penalty imposed under S. 140A(3) of the IT Act ?
2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the decision of the Madras High Court in A. M. Sali Maricar & Anr. vs. ITO & Anr. (1973) 90 ITR 116 (Mad) 51, would not apply to the provisions of S. 140A after the assessment made w.e.f. 1st April, 1976 ?”
2. The assessees major income was from the firm M/s Viswanathan Textiles. The assessee filed his returns of income for the asst. yr. 1976-77 on 17th February, 1977 declaring a total income of Rs. 68,575. This was accepted by the ITO and the assessment was completed in November, 1997. The ITO noticed that the assessee had not paid the self-assessment tax as required under S. 140A(1) of the Act and so, under sub-s. (3) of S. 140A, the assessee is liable to pay penalty. A show-cause notice was issued by the ITO. The assessee sent a reply stating that in view of the decision of the Madras High Court in A. M. Sali Maricar & Anr. vs. ITO & Anr. (supra), the levy of penalty for the non-compliance of the provisions of S. 140A(1) was not legal. According to the ITO, the provision of S. 140A of the Act was amended by Taxation Laws (Amendment) Act, 1970 w.e.f. 1st April, 1971 and the penal provisions contained in sub-s. (3) of S. 140A had been drastically altered by an amendment Act of 1975 w.e.f. 1st April, 1976. The assessees previous year ended on 12th April, 1976 and the return was filed on 17th February, 1977. Therefore, the ITO found that the decision of the Madras High Court in Sali Maricars (supra) case is not applicable to the amended provisions of the Act. Before the ITO, the assessee pleaded that the amended provisions of S. 140A(3) is ultra vires. However, the ITO pointed out that the ITOs are functioning under the statute, they cannot go into the question of the vires of the provisions of the Act. Accordingly the ITO levied a penalty of Rs. 5,696. On appeal, the AAC confirmed the order passed by the ITO. On further appeal filed by the assessee, the Tribunal confirmed the order passed by the AAC.
3. Before us, the learned counsel appearing for the assessee submitted that the order passed by the Tribunal confirming the penalty imposed by the ITO under S. 140A(3) is not sustainable. According to the learned counsel for the assessee, the assessee must be given an opportunity to explain the reasonable cause for the delay in payment of the self-assessment tax. Therefore, it was submitted that the order passed by the Tribunal is not sustainable. On the other hand, the learned standing counsel appearing for the Department while supporting the order passed by the Tribunal, relied on the decision of this Court made in the case of Ooty Dasprakash vs. ITO 1994 (5) MTCR 50, wherein this Court declared that the amended provisions of S. 140A(3) is constitutionally valid and does not suffer from unconstitutionality.
4. We have heard the learned counsel for the assessee as well as the learned Standing counsel for the Department. The self-assessment tax was not paid in time. In the asst. yr. 1976-77, the amended provisions of S. 140A came into force w.e.f. 1st April, 1976. The assessees previous year ended on 12th April, 1976 and the return was filed on 17th February, 1977. Therefore, the amended provisions of S. 140A is applicable to the facts of this case. For the delay in payment of self-assessment tax, the assessee sent a reply before the ITO stating that in view of the decision of this Court in Sali Maricar case (supra) no penalty under S. 140A(3) is exigible. After the amended provisions came into force, the decision rendered in the case of Sali Maricar (supra), has become no longer a good law. Further, the assessee has not given any reasonable cause for not paying the self-assessment tax in time. In the absence of any reasonable cause it is not possible to cancel the penalty levied under S. 140A(3) of the Act. In this view of the matter, we answer the questions referred to us in the affirmative and against the assessee. No costs.
