JUDGMENT 1. At the instance of the Revenue, the Income-tax Appellate Tribunal has referred the following question for the opinion of the High Court: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the Inspecting Assistant Commissioner had no jurisdiction to levy the impugned penalties ?" 2. The facts relevant are these : 3. The assessee was a registered firm. For the assessment year 1972-73, the assessment was completed on November 15, 1973, by the Income-tax Officer. At the time of completing the assessment, the Income-tax Officer initiated penalty proceedings under section 271(1)(c) of the Income-tax Act, 1961, read with the Taxation Laws (Amendment) Act, 1975 (Act No. 41 of 1975). Since the minimum penalty leviable exceeded rupees one thousand, the Income-tax Officer referred the matter to the Inspecting Assistant Commissioner who imposed penalty under section 271(1)(c) on July 8,1976. 4. In respect of the assessment year 1973-74, the return was filed by the assessee-firm. The Income-tax Officer completed the assessment on November 17, 1973. At the time of completing the assessment, he initiated penalty proceedings under section 271(1)(c) of the Income-tax Act. Since the minimum penalty leviable exceeded rupees one thousand, the matter was referred to the Inspecting Assistant Commissioner. 5. In both the matters, the Inspecting Assistant Commissioner imposed penalty under section 271(1)(c). On the assessee taking up the matter before the Tribunal, the orders of the Inspecting Assistant Commissioner were reversed on the finding that the Inspecting Assistant Commissioner had no jurisdiction to impose penalty after April 1, 1976, when the Taxation Laws (Amendment) Act, 1975, came into force. 6. On an application made by the Department, the following question was referred by the Tribunal for the opinion of the High Court: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the Inspecting Assistant Commissioner had no jurisdiction to levy the impugned penalties ? " 7. We have noted above that the orders imposing penalty were made by the Inspecting Assistant Commissioner of Income-tax in July, 1976. The argument of the assessee before the Tribunal, as also before us, was that, as the penalty orders were passed after April 1, 1976, the Inspecting Assistant Commissioner did not have jurisdiction to pass those orders. The orders of penalty were void ab initio. The argument of the assessee before the Tribunal, as also before us, was that, as the penalty orders were passed after April 1, 1976, the Inspecting Assistant Commissioner did not have jurisdiction to pass those orders. The orders of penalty were void ab initio. Reliance had been placed on the decision in CIT v. Dhadi Sahu 1976 (105) ITR 56 (Ori) . We are not satisfied with the argument of the assessee. After April 1, 1976, section 274(2) of the Act was deleted. It means that from April 1, 1976, the Inspecting Assistant Commissioner no longer remained in power to impose penalty under section 271(1)(c) of the Act. With effect from April 1, 1976, section 271(1)(c) of the Act provides that if the Income-tax Officer is satisfied that any person has concealed the particulars of his income or furnished inaccurate particulars of such income, he may direct that such person shall pay by way of penalty, in the cases referred to in clause (c), in addition to any amount of tax payable by him, a sum which shall not be less than ten per cent. but which shall not exceed fifty per cent. of the amount of tax sought to be avoided by reason of concealment of particulars of his income or furnishing of inaccurate particulars of such income (sic). 8. From the above, it would appear that the Income-tax Officer was empowered to impose penalty under section 271 (1) (c) of the Act. In view of the Amending Act, 1975 (Act No. 41 of 1975), this submission has no substance. The provisions of the Amending Act as well as those of section 274 read together would indicate that if a reference has been made by the Income-tax Officer to the Inspecting Assistant Commissioner for imposition of penalty in a case where the penalty was more than rupees one thousand, the Inspecting Assistant Commissioner would have jurisdiction to impose penalty under section 271(1)(c) of the Act. But where reference had not been made before April 1, 1976, the Inspecting Assistant Commissioner would have no jurisdiction. 9. Before the Tribunal, the Revenue contended that, the Inspecting Assistant Commissioner was perfectly justified in imposing the penalties even after April 1, 1976, because they were validly initiated before that date. 10. In CIT v. Smt. Amar Kumari 1988 (169) ITR 255 (Raj) , this question came up for consideration before this court. 9. Before the Tribunal, the Revenue contended that, the Inspecting Assistant Commissioner was perfectly justified in imposing the penalties even after April 1, 1976, because they were validly initiated before that date. 10. In CIT v. Smt. Amar Kumari 1988 (169) ITR 255 (Raj) , this question came up for consideration before this court. The court held that the relevant consideration in judging the validity of an order passed by the Inspecting Assistant Commissioner was whether the penalty proceedings were pending before the Inspecting Assistant Commissioner prior to April 1, 1976. If the reference had been made prior to April 1, 1976, when sub- section (2) of section 274 of the Act was deleted, the Inspecting Assistant Commissioner would have jurisdiction to impose penalty, since the Inspecting Assistant Commissioner's jurisdiction was saved even after the deletion of sub-section (2) of section 274 only in respect of the references made to the IAC and pending with the IAC prior to April 1, 1976. We have noted above that his jurisdiction was saved in respect of references made to him prior to April 1, 1976. We are in respectful agreement with the view taken in the aforesaid decision. 11. From the referring order, the date on which reference was made by the Income-tax Officer to the Inspecting Assistant Commissioner is not clear. However, the mistake of the Tribunal on that count does not come in our way in deciding the reference by holding that if the reference had been made by the Income-tax Officer to the Inspecting Assistant Commissioner before April 1, 1976, he would have jurisdiction to decide it. The order imposing penalty could be valid, but if no reference was made before that date, the Inspecting Assistant Commissioner would have no power to impose penalty under section 271(1)(c). Initiation of penalty proceedings under section 271(1)(c) of the Income-tax Act, 1961, does not in itself decide the validity of the penalty order. It is the date of reference which is material. 12. For the reasons given above, we answer the question referred to us by holding that the Inspecting Assistant Commissioner would have jurisdiction to levy penalty if the reference had been made by the Income-tax Officer to the Inspecting Assistant Commissioner before April 1, 1976. But if that was not so done, the penalty orders would be void. 13. In the circumstances, we make no order as to costs. *******