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TMI Blog1976 (11) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... n filing the Wealth-tax returns. To the show cause notice issued proposing levy of penalty, the assessee had replied stating that house properties fetched a net income of about Rs. 9,500 Per annum and even on the basis of 20 years wealth-tax liability would not be attracted, that a portion of its properties at Madras was under long lease with Caltex Company and was, therefore, not marketable that as soon as it came to know that there would be wealth tax liability, it filed the wealth-tax returns voluntarily, though late and that it was filing the income-tax returns regularly and petition under s. 18(24) was also filed before the Commr. Of Income Tax. The Wealth-tax Officer did not accept the assessee s plea as not convincing. He levied penalties for the years under appeal under s.18 (1) (a) of the Wealth-tax Act. 3. The assessee appealed to the Appellate Assistant Commissioner and submitted before him that the assessee was under the bonafide impression that its wealth would not exceeded the taxable a minimum for wealth tax purposes in its status as Hindu undivided family, which was taken at Rs.4 lakhs, that the assessee was regularly assessed to income-tax for a long time that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Chartered Consulting Engineer, which was found in the Wealth tax file, as per which the entire property was valued by him at Rs.3,65,000, that the assessee was in a way guided by the above report of the valuer to come to the finding that the value of its property was below the taxable minimum in the light of its impression that Rs. 4 lakhs was the minimum taxable wealth. In the circumstances the Appellate Assistant Commissioner was inclined to accept the claim of the assessee that it was under the bonafide though mistaken impression of its being not assessable to wealth tax. The Appellate Asst. Commr. also took note of the fact that the assessee was chosen to file the returns showing the net wealth above the taxable minimum as soon as it got the valuation of the properties ascertained. In any case the Appellate Assistant Commissioner found that for the assessment years 1962-63 and 1963-64 the net wealth returned by the assessment years 1962-63 and 1963-64 the net wealth returned by the assessee was below Rs.4 lakhs, which was the minimum fixed for the two years according to law. The Appellate Assistant Commissioner held that there was reasonable cause within the meaning s. 18 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1964-65 37,180 3,33,200 3,70,380 7,16,780 1965-66 37,180 3,33,200 3,70,380 7,16,780 1966-67 37,431 3,92,000 4,29,431 8,83,731 1967-68 37,431 3,92,000 4,29,431 8,83,731 1968-69 37,431 3,92,000 4,29,431 8,83,731 1969-70 37,431 3.92,000 4,29,431 8,83,731 1970-71 37,431 3,92,000 4,29,431 10,40,231 The wealth tax returns for the assessment years 1962-63 to 1965-66 were filed on 9th March, 1971 and for the assessment years 1966-67 to 1970-71 on 5th Feb., 1971. The penalties levied by the Wealth tax Officer under s. 18(1) (a) for the years appeal are as under:- Asst year Penalty levied . Rs. 1962-63 31,824 1963-64 30,624 1964-65 60,220 1965-66 59,778 1966-67 57,117 1967-68 75,403 1968-69 72,946 1969-70 61,645 1970-71 15,928 As against the Wealth tax levied for the above nine years of a tota ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... minimum could not be registered as not bonofide. The law relating to levy of penalty for non compliance with the statutory obligation is now well-settled. The supreme Court in the case of Hindustan Steel ltd. vs. State of Orissa (1), has laid down the following dictum:- " An order imposing penalty for failure to carry out a statutory obligation is the result of a quasi-criminal proceeding, and penalty will not ordinarily be imposed unless the party obliged either acted deliberately in defiance of law or was guilty of conduct contumacious or dishonest, or acted in conscious disregard of its obligation. Penalty will not also be imposed merely because it is lawful to do so whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judicially and on a consideration of all the relevant circumstances. Even if a minimum penalty is prescribed, the authority competent to impose the penalty will be justified in refusing to impose penalty, when there is a technical or venial breach of the provisions of the Act or where the breach flows from a bonafide belief that the offender is not liable to act in the manner ..... X X X X Extracts X X X X X X X X Extracts X X X X
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