1989 (8) TMI 122 - AT - Wealth-tax

Summary

Issues:
1. Condonation of delay in filing an appeal against penalty imposed under s. 18(1)(a) of the WT Act, 1957.
2. Calculation of penalty based on wealth assessment and taxable limit for the assessment year.
3. Tribunal's consideration of reasonable cause for late filing of return.
4. High Court's direction to Tribunal to reexamine the existence of a reasonable cause.

Condonation of Delay:
The appeal was filed by the assessee against a penalty imposed under s. 18(1)(a) of the Wealth Tax Act, 1957, for the assessment year 1960-61, after a significant delay of 13 years, 4 months, and 11 days. The delay was attributed to various legal proceedings and discrepancies in wealth assessment.

Calculation of Penalty:
The Wealth Tax Officer (WTO) estimated the assessee's wealth at Rs. 7 lakhs, leading to a penalty of Rs. 1,00,130. However, the Tribunal later determined the value of the right to receive compensation at Rs. 1,37,720, which fell below the minimum taxable limit of Rs. 2 lakhs for the assessment year. The Tribunal confirmed the penalty calculation based on the wealth assessment, leading to an appeal by the assessee.

Tribunal's Consideration of Reasonable Cause:
The Tribunal initially overlooked the High Court's direction to consider the existence of a reasonable cause for the late filing of the return. The assessee contended that there were grounds constituting a reasonable cause for the delay, and the Tribunal was mandated to assess this aspect afresh.

High Court's Direction:
The High Court upheld the Revenue's contention regarding penalty computation but allowed the assessee to raise the argument of a reasonable cause for late filing before the Tribunal. The Tribunal, upon receiving the High Court's directions, confirmed the penalty without considering the reasonable cause. However, upon a miscellaneous petition from the assessee, the Tribunal recalled its order for further consideration.

In conclusion, the delay in filing the appeal was condoned, and the Tribunal allowed the appeal as the assessee's wealth fell below the minimum taxable limit, absolving her of any liability to pay the penalty for late filing of the return. The Tribunal dismissed the earlier appeal related to penalty calculation based on the wealth assessment.