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Interpretation of penalty provisions under section 18(1)(a) of the Wealth-tax Act for default in filing wealth-tax returns. Detailed Analysis: The judgment pertains to three tax case references initiated by the Revenue regarding the computation of penalties under section 18(1)(a) of the Wealth-tax Act for the assessment years 1966-67 to 1968-69. The primary issue revolves around whether the penalties should be based on the provisions existing before the amendment or after, considering the default continued post-amendment (April 1, 1969). The Wealth-tax Officer imposed penalties for delayed filing of wealth-tax returns, prompting the deceased assessee to appeal to the Appellate Assistant Commissioner, who opined that penalties should align with the rates applicable at the time of default, not when the orders were passed. The Appellate Assistant Commissioner's decision was challenged by the Revenue before the Tribunal, which upheld the Commissioner's stance citing a precedent related to the Gift-tax Act. The Tribunal concurred that penalties should be determined based on the rates in force at the time of default, in line with the analogous provisions of the Gift-tax Act. Subsequently, the Revenue, dissatisfied with the Tribunal's ruling, escalated the matter to the High Court for adjudication. During the proceedings, the Revenue contended that the Tribunal's decision, influenced by the earlier judgment, was no longer valid post a Supreme Court ruling in Maya Rani Punj v. CIT [1986] 157 ITR 330. The Supreme Court's decision emphasized that non-filing of returns within the stipulated time constitutes a continuing offense, necessitating penalties to be calculated based on the duration of default. The Court highlighted that penalties are applicable as long as the default persists, reflecting the legislative intent to penalize non-compliance with the law continuously. In light of the Supreme Court's principles, the High Court concluded that the Tribunal's reliance on the previous judgment was misplaced, rendering it unsustainable. Consequently, the High Court ruled against the assessee, affirming that penalties should be computed considering the extended default period post-amendment. The Court's decision favored the Revenue, entitling them to costs and counsel fees.
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