1981 (2) TMI 8 - HC - Wealth-tax

Summary

Issues:
1. Jurisdiction of the Income-tax Appellate Tribunal (IAC) in imposing penalty under section 18(1)(c) of the Wealth Tax Act, 1957.
2. Whether there was concealment of wealth attracting penalty under section 18(1)(c) of the Act.

Analysis:
Issue 1:
The case involved a reference under section 27(1) of the Wealth Tax Act, 1957, regarding the jurisdiction of the IAC in imposing a penalty under section 18(1)(c). The Tribunal had held that the IAC had no jurisdiction to impose the penalty after April 1, 1976, based on an amendment to section 18(3) of the Act. However, the High Court, citing previous decisions, determined that the IAC had jurisdiction at the time of imposing the penalty, as the amendment to section 18(3) did not invalidate pending references. The court relied on the similarity between section 18(3) of the Wealth Tax Act and section 274(2) of the Income Tax Act, emphasizing that the amendment did not affect the IAC's jurisdiction in this case. The first question was answered in favor of the Department, confirming the jurisdiction of the IAC.

Issue 2:
The second question revolved around whether there was concealment of wealth warranting a penalty under section 18(1)(c) of the Act. The Tribunal had found that there was no concealment as the assessee had disclosed all relevant facts. The High Court noted that the Tribunal's finding of no concealment was based on factual considerations rather than a legal question. As a result, the court determined that this question did not qualify as a legal issue for reference. Therefore, the High Court answered the second question accordingly, indicating that the question of concealment did not arise as a legal matter for consideration in this case.

In conclusion, the High Court upheld the jurisdiction of the IAC in imposing the penalty under section 18(1)(c) of the Wealth Tax Act and clarified that the absence of concealment of wealth by the assessee was a factual finding rather than a legal issue for reference.