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2018 (3) TMI 595 - AT - Wealth-taxPenalty invoking Explanation-3 to Section 18(1)(c) of WT act - unaccounted assets / income unearthed in search / survey action - Held that - The return of wealth tax filed by the assessee got triggered only due to search / survey action carried out by the department wherein unaccounted assets / income was unearthed. The assessee never filed return of wealth for the impugned AY before the search / survey action despite having taxable wealth. Therefore, in our opinion, the said return was not voluntary but only the result of the search / survey action on the part of the revenue. Hence, the reliance of the revenue on Explanation-3 to Section 18(1)(c) and the cited order of the Pune Tribunal was quite appropriate, reasonable and justified. No contrary judgment has been placed on record by the assessee. Therefore, we find no reason to interfere with the orders of lower authorities in any manner. Resultantly, the assessee s appeal stands dismissed.
Issues:
1. Confirmation of penalty under Section 18(1)(c) of The Wealth Tax Act, 1957. 2. Validity of penalty notice specifying the charge. 3. Voluntariness of filing the return of wealth. 4. Valuation of shop premises under Schedule III. 5. Treatment of "Cash in Hand" as a liability. Analysis: Issue 1: Confirmation of penalty under Section 18(1)(c) The appeals contested the order of the Commissioner of Wealth Tax (Appeals) regarding the confirmation of penalty under Section 18(1)(c) of The Wealth Tax Act, 1957. The Tribunal disposed of the appeals collectively due to a common order by the first appellate authority. Despite the absence of the assessee, the Tribunal proceeded based on the available material and the arguments presented by the Departmental Representative. Issue 2: Validity of penalty notice specifying the charge The first ground of appeal questioned the validity of the penalty notice under Section 18(1)(c) for not specifying whether it was for furnishing inaccurate particulars of income or concealment of income. The Tribunal dismissed this ground as the relevant penalty notices were not on record, leading to the dismissal of the appeal on this technical ground. Issue 3: Voluntariness of filing the return of wealth The second ground of appeal raised concerns about the voluntariness of filing the return of wealth before the issuance of the notice under Section 16(2). The Tribunal found that the return was not voluntary but a result of the search/survey action by the department, uncovering unaccounted assets/income. Therefore, the imposition of penalty under Explanation-3 to Section 18(1)(c) was deemed appropriate, justifying the lower authorities' decisions. Issue 4: Valuation of shop premises under Schedule III The third ground of appeal challenged the valuation of shop premises by the Wealth Tax Officer, alleging a deviation from the rules prescribed under Schedule III of the Act. The Tribunal dismissed this ground as it was beyond the scope of the present appeal, which focused solely on the confirmation of penalty. Issue 5: Treatment of "Cash in Hand" as a liability The fourth ground of appeal disputed the inclusion of "Cash in Hand" as part of the assessee's wealth, arguing that it belonged to another entity. The Tribunal did not delve into this issue, as it pertained to quantum additions, which were not the subject of the current appeal. The Tribunal upheld the penalties imposed on the assessee for various assessment years, concluding that the appeals lacked merit and were dismissed accordingly. The decision was pronounced on 21st February 2018.
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