1984 (8) TMI 91 - AT - Wealth-tax

Summary

Issues:
1. Imposition of penalty under s. 18(1)(c) of the WT Act, 1957.

Detailed Analysis:
The judgment revolves around the imposition of penalties under section 18(1)(c) of the Wealth Tax Act, 1957. The primary issue in the appeals and cross objections pertains to the penalty imposed on the assessee, who is an HUF, for the difference in valuation of a property owned jointly with another person. The valuation discrepancy arose due to differing valuations provided by the assessee, the Departmental Valuation Officer (DVO), and the approved valuer. The penalty proceedings were initiated by the WTO for the variation in the value shown by the assessee in the original and revised returns.

The assessee, in response to the penalty imposition, denied any concealment or inaccurate particulars of wealth. The assessee explained that the revised valuations were done in good faith to ascertain the correct market value for partitioning the property between the members of the HUF due to family disputes. Despite the explanation, the WTO imposed penalties for each relevant year.

In the appeal before the CIT (A), the assessee argued that the penalty should be cancelled as the valuation difference was due to an honest difference of opinion between the assessee's valuer and the DVO. The CIT (A) agreed with the assessee's contention and cancelled the penalties, emphasizing that the valuation discrepancy did not warrant penalty under section 18(1)(c) of the Act.

The Revenue appealed against the CIT (A) order before the Tribunal, challenging the cancellation of penalties. The Tribunal observed that the Revenue's decision to file appeals without proper application of mind was unwarranted. It noted that the WTO should have adopted the valuation made by the DVO instead of the figure shown by the assessee in the revised returns. The Tribunal upheld the CIT (A) order, citing the decision of the Hon'ble Gujarat High Court and emphasizing the assessee's right to file revised returns voluntarily before the original assessments were framed.

Ultimately, the Tribunal dismissed both the appeals and cross objections, affirming the cancellation of penalties and highlighting the importance of applying correct valuation procedures and legal provisions in such cases.