2017 (8) TMI 1362 - AT - Wealth-tax

Filing Wealth Tax Returns not filed his WT Returns within the due date - levy of interest u/s.17B - Held that - In respect of the AYs 2007-08 & 2008-09, the filing of the return of wealth is mandatory duty on the assessee once the net wealth exceeds the prescribed limit. Just because, the due date for filing of the Wealth Tax Returns expire and the assessee had not filed his return within the due date, it cannot be said that the assessee is exempted from the levy of interest u/s.17B in respect of the period between the due date and the date of the notice u/s.17. The levy of interest u/s.17B is admittedly compensatory in nature. In these circumstances, respectfully following the decision of Co-ordinate Bench of this Tribunal in the case of Smt.M.R. Prabhavathy v. ACIT 2002 (1) TMI 8 - KARNATAKA High Court the order of the Ld.CIT(A) on this issue stands reversed and that of the AO restored. In respect of the AYs 2009-10, 2010-11 & 2011-12, it is noticed that the assessee has filed his return of income within the due date. The Revenue has not been able to dispute this fact. Even considering the submission of the Ld.DR that the return was not before the AO, the same would not stand, in so far as, that is not the ground raised by the Revenue.

Summary

Issues:
Appeals filed by Revenue against Commissioner of Wealth Tax (Appeals) order, Cross-Objections filed by assessee, Levy of interest under section 17B of the Act, Filing of Wealth Tax Returns beyond due date, Applicability of interest u/s.17B, Interpretation of sections 14, 15, and 17 of the Wealth Tax Act, 1957.

Analysis:
The Appellate Tribunal, ITAT Chennai, heard appeals filed by the Revenue against the order of the Commissioner of Wealth Tax (Appeals) and Cross-Objections filed by the assessee for various assessment years. The main issue revolved around the levy of interest under section 17B of the Wealth Tax Act, 1957. The Revenue contended that the assessee failed to file Wealth Tax Returns within the due date, leading to the issuance of notice u/s.17. The Revenue argued that interest u/s.17B was compensatory and relied on a precedent to support their stance.

The assessee, on the other hand, argued that the inability to file returns within the due date due to the absence of a statutory provision for filing belated returns should not be held against them. The assessee highlighted the period between the due date and the notice u/s.17 should be excluded, as the delay was not due to their failure. The assessee also presented original returns filed for certain assessment years to support their case.

The Tribunal analyzed the submissions and referred to a Co-ordinate Bench decision to make its ruling. For the assessment years where the assessee failed to file returns within the due date, the Tribunal reversed the Commissioner's order and upheld the levy of interest u/s.17B by the Assessing Officer. However, for the assessment years where the assessee filed returns within the due date, the Tribunal confirmed the Commissioner's order, as the Revenue could not dispute this fact.

Consequently, the Tribunal allowed the Revenue's appeals for certain assessment years and dismissed them for others. The Cross-Objections filed by the assessee were deemed infructuous and dismissed accordingly. The Tribunal pronounced the order in open court, providing a detailed analysis of the issues and legal provisions considered in arriving at the judgment.