1986 (8) TMI 37 - HC - Wealth-tax

Summary

Issues:
Delay in filing wealth-tax return leading to penalty under section 18(1)(a) of the Wealth-tax Act, 1957. Interpretation of law regarding the period for which penalty is leviable - pre-amended law or amended law.

Analysis:
The judgment by the High Court of Calcutta involved the case of an assessee who was assessed to wealth-tax for the year 1968-69 but filed the return after the due date of June 30, 1968, citing illness as the reason for the delay. The Wealth-tax Officer initiated penalty proceedings under section 18(1)(a) of the Wealth-tax Act and levied a penalty of Rs. 23,400, which was upheld by the Appellate Assistant Commissioner. However, the Appellate Assistant Commissioner directed that penalty should be levied as per the law in force prior to the amendment of section 18(1) that came into effect from April 1, 1969.

The Revenue appealed to the Income-tax Appellate Tribunal contending that penalty should be levied under the amended law for the period after March 31, 1969. The Tribunal, following decisions of the Madras and Allahabad High Courts, held that the penalty should be governed by the law in force on the due date when the return was not filed. The Revenue then applied under section 27(1) of the Wealth-tax Act, raising a question on the applicable law for penalty calculation.

The High Court referred to several Supreme Court decisions, including Brij Mohan v. CIT, Commissioner of Wealth-tax v. Suresh Seth, and Maya Rani Punj v. CIT, to determine the applicable law for penalty calculation. Following the decision in Maya Rani Punj, the High Court held that penalty should be levied in accordance with the law in force when the wealth-tax assessment was completed and the proceedings for penalty initiation were decided, applying the amended law that came into effect after April 1, 1969. The judgment was in favor of the Revenue.

The High Court appreciated the assistance of an amicus curiae and disposed of the reference with no order as to costs. Both judges, Mrs. Monjula Bose and Dipak Kumar Sen, concurred with the decision.