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TMI Blog1983 (3) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... cancelling the penalty levied under section 18(1)(a) of the Wealth-tax Act, 1957 ('the Act'). 3. The assessee has filed the returns of net wealth in respect of the assessment years 1974-75 and 1975-76 on 24-4-1975 and 15-1-1976, respectively. But actually the return for the assessment year 1974-75 was required to be filed on or before 30-6-1974 and that for the assessment year 1975-76 on or before 30-6-1975. Thus, there was delay in filing the returns. Before the penalty orders were passed by the WTO, the assessee approached the Commissioner of Wealth-tax under section 18B of the Act for waiver of penalty. The Commissioner of Wealth-tax vide his order, dated 7-2-1979, held that in this case the penalty is leviable. However, he restricted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1)(a) are maintainable. He relied on the decisions in the cases of CGT v. N. Palaniappa Mudaliar [1978] 113 ITR 440 (Mad.), CWT v. M.K.S. Vanavarayar [1980] 122 ITR 184 (Mad.) and B. Kempanna. Further he relied on the ratio of decisions of the Rajasthan High Court and the Gujarat High Court wherein it has been held that since application for extension of time has not been rejected, it should be taken as reasonable cause for not filing the return in time. 6. We have heard the rival submissions and perused the entire evidence on record. The facts in the case of Smt. Kherunissa Allibhai v. CIT [1978] 113 ITR 443, before their Lordships of the Gujarat High Court were that the assessee approached the Commissioner of Income-tax under section 27 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal as well as he can approach the Commissioner of Income-tax for waiver or reduction of penalty. 7. In the case of M.K.S. Vanavarayar, their Lordships of the Madras High Court have held that as the appeals to the AAC were against the orders of the WTO passed in pursuance of orders passed by the Commissioner of Wealth-tax under section 18(2A), the appeals to the AAC were competent. The decision of their Lordships of the Madras High Court on this point squarely covers the case before us. Their Lordships of the Madras High Court at page 190 of the report, have further observed that the order passed by the Commissioner of Wealth-tax under section 18(2A) was invalid since it was not communicated of the assessee. The order passed by the WTO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tainable . . ." From the above observations it appears that the ambit and scope of section 18(2A) is quite different and in no way affects the jurisdiction of the WTO to decide the questions arising under section 18(1)(a) as to the existence or non-existence of reasonable cause. The only effect the order of the Commissioner would have is that the minimum penalty to be levied by the WTO would be in accordance with what is determined by the Commissioner if the minimum penalty is only reduced and not waived, and if it is waived, the WTO is also bound not to levy any penalty. Apart from this there is no other effect consequent on the order of the Commissioner under section 18(2A) so far as jurisdiction of the WTO is concerned in the matter of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot so, he should not be penalised unless there is a clear case of default. Looking to the aforesaid facts and entirety of the circumstances of the case, we are of the opinion that against the orders of the WTO passed under section 18(1)(a) appeals are maintainable. 9. Now the point which remains for our consideration is that whether on merits penalty is leviable in this case under section 18(1)(a). The assessee has filed applications for extension of time for filing the returns. Such applications were filed on many occasions, the last one being filed on 5-7-1975 in respect of the assessment year 1974-75 asking for time till 31-8-1975. Similarly the assessee filed applications asking time for filing return up to 31-11-1975 in respect of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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