1979 (11) TMI 129 - AT - Wealth-tax

Summary

Issues:
1. Penalty imposed by the WTO under section 18(1)(a) of the Wealth Tax Act for delayed filing of returns.
2. Appeal by the Revenue against the AAC's cancellation of penalty orders.
3. Justification for late filing of wealth tax returns due to late filing of income tax returns.
4. Interpretation of reasonable cause for delayed filing of returns under the Wealth Tax Act.
5. Comparison of the case with a decision of the Hon'ble Madras High Court.

Detailed Analysis:
1. The case involved appeals by the Revenue against the AAC's decision to cancel penalty orders imposed by the WTO under section 18(1)(a) of the Wealth Tax Act for delayed filing of returns. The WTO initiated penalty proceedings due to late filing of returns for the assessment years 1971-72 and 1972-73. The WTO imposed penalties for the delays, which were later cancelled by the AAC based on the explanation provided by the assessee regarding the delay being due to late filing of income tax returns.

2. The Revenue, represented by the authorized representative, argued that the AAC erred in cancelling the penalty orders as there was no reasonable cause for the delay in filing the wealth tax returns, despite the explanation provided by the assessee. The Revenue contended that late filing of income tax returns did not justify the delay in filing wealth tax returns, and therefore, the penalty should have been upheld.

3. On the other hand, the assessee's counsel argued that the delay in filing the wealth tax returns was justified due to the late filing of income tax returns. The counsel emphasized that the delay was not intentional and that the assessee could not have filed the wealth tax returns before the income tax returns. The assessee relied on a decision of the Hon'ble Madras High Court to support their argument.

4. Upon considering the arguments from both sides, the appellate tribunal found that the delay in filing the wealth tax returns was indeed due to the late filing of income tax returns. The tribunal noted that the assessee had both landed and movable assets with a substantial gross value. By comparing the case with the decision of the Hon'ble Madras High Court, the tribunal concluded that there was a reasonable cause for the delay in filing the wealth tax returns, and therefore, no penalty was warranted.

5. Consequently, the appellate tribunal dismissed the appeals by the Revenue, confirming the AAC's decision to cancel the penalty orders imposed by the WTO. The tribunal upheld that the delay in filing the wealth tax returns was justified and that no penalty should be imposed on the assessee.