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TMI Blog1979 (9) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... of jewellery shown by the assessee and instead, by notice dt. 15th Jan., 1975, under s. 16(4) of the WT Act, 1957 directed the assessee to furnish particulars of each item of jewellery with weight, value and description duly supported by the certificate of an approved valuer. In compliance with this notice, the assessee furnished a fresh valuation certificate of the value of jewellery as on 31st March, 1974 from the same approved valuer, Shri Gopi Nath Mahendra. According to the fresh valuation report dt. 17th Jan., 1975 of Shri Gopi Nath Mahendra, value of the jewellery as on 31st March, 1974 was Rs.1,43,815. The WTO took the value of the jewellery as per the valuer's report dt. 17th March, 1978 imposed a penalty of Rs. 70,500 under s. 18(1)(c). The IAC to whom the penalty proceedings were referred by order dt. 1st March, 1978 imposed a penalty of Rs. 70,500 under s. 18(1)(c) of the WT Act, 1957. Aggrieved by this penalty imposed by the IAC, the assessee has come up in the present appeal before us. 3. At the out-set, objection was taken to the maintainability of the appeal by the learned Departmental Representative, Shri Khokhar on the ground that since by the Taxation Laws (Am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ril, 1976 was mis-conceived and the Tribunal had no jurisdiction to hear the appeal against the order of penalty under s. 18(3) r/w s. 18(1)(c) of the WT Act, 1957 passed by the IAC. Alternatively, Shri Khokhar submitted to us that the ruling of the Hon'ble High Court of Allahabad in the case of CIT vs. Om Sons(5), will apply not only to the jurisdiction of the IAC imposing the penalty under s. 18(3) r/w s. 18(1)(c) of the WT Act, 1957 when the jurisdiction of both the IAC and the Tribunal had been taken away by the Taxation Laws (Amendment) Act, 1975 w.e.f. 1st April, 1976. Elaborating on his argument, Shri Khokhar contended before us that if the IAC in view of the ruling of the Hon'ble High Court of Allahabad in the case of CIT vs. Om Sons(5), had no jurisdiction to impose the penalty under s. 18(3) r/w s. 18(1)(c) of the WT Act, 1957, the Tribunal also had no jurisdiction to hear an appeal against the order of the IAC imposing such penalty on or after 1st April, 1976 i.e. the date from which the jurisdiction of both the authorities was taken away by the Taxation Laws (Amendment) Act, 1975. Summing up, Shri Khokhar vehemently argued before us that the Tribunal has no jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal should always be allowed rather than denied. Elaborating on this argument, Dr. Vaish cited two examples before us, one came where even though the penalty order was passed by the IAC on 15th March, 1976 and the appeal was filed on 25th March, 1976, still the Tribunal can be said to have no jurisdiction to hear the appeal since the hearing could invariably take place after 31st March, 1976, and another case, where the penalty was imposed by the IAC on 31st March, 1976, but still the appeal before the Tribunal was said to be not maintainable because the appeal was filed after 31st March, 1976 to point out the absurdities, the interpretations put by the Department will lead to and in support of the contention that where two interpretations are possible, one of which leads at absurd situation and another which leads to a rational, logical and harmonious interpretation, the latter should be preferred. He also referred to the ruling of the Hon'ble Supreme Court in the case of Jose Da Costa and Another vs. Bascora Sadashiva Sinai Narcornin and Others(2), relied upon by the learned Departmental Representative, Shri Khokar in order to point out that even in this case, the Hon'ble Supr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ruling will, therefore, not be applicable here. We have the authority of a number of judicial pronouncements by the Hon'ble Supreme Court cited by the assessee's learned counsel Dr. Vaish in the case of Garikapati Veeraya vs. N. Subbaiah Chowdhry and others(8) wherein their Lordships laid down that the right of appeal is a vested right and such a right to enter the superior Court accrues to the litigant and exists as on and from the date the lis commences and although it may be actually exercised when the adverse judgment is pronounced such right is to be governed by the law that prevails at the date of its decision or at the date of the filing of the appeal and this vested right of appeal can be taken away only by a subsequent enactment if it so provides expressly or by necessary intendment or not otherwise. Viewed in this context, it is not under dispute before us that on 28th Feb., 1976, the notice was issued requiring the assessee to show cause why penalty under s. 18(1)(c) of the WT Act, 1957, should not be imposed i.e. in other words on 28th Feb., 1976, the proceedings to the prejudice of the assessee commenced and the lis arose, the assessee's right of a likely appeal in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the next asst. yr. 1973-74, for which the relevant valuation date was 31st March, 1973. In these circumstances, according to Dr. Vaish, if the assessee was under the impression that the valuation of jewellery once made with be valid not only for the assessment year for which it was made, but also for the next two assessment years as in the case of property, the assessee's belief cannot be said to be not bonafide. Proceeding further, Dr. Vaish submitted to us that the moment the WTO asked the assessee to furnish a fresh valuation report of the value of jewellery as on 31st March, 1974 was promptly filed, which was again accepted by the WTO and this itself prove the assessee's bona fides. Here, Dr. Vaish also pointed out to us that while in the report dt. 29th July, 1972, four diamond chooris were shown against the No. 9 at one place, in the subsequent report date 17th Jan., 1975, the four diamond chooris were split up into two items of jewellery in the original report dt. 29th July, 1972 and the subsequent report dt. 17th Jan., 1975 and hence the observation of the IAC in his order that two chooris were not taken into account, for the asst. yr. 1974-75 under appeal before us in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Expln. to s. 18(1)(c) and the omission of the word 'deliberate' the rulings of Hon'ble Supreme Court in the case of CIT vs. Anwar Ali (14), and Hindustan Steel Ltd. vs. State of Orissa (11), will not be applicable. He also relied on the order of the IAC in support of the penalty imposed by him. Summing up, Shri Khokhar argued before us that the penalty under appeal before us was justified and should be upheld. 9. We have carefully considered the rival submissions. It is not under dispute before us that there was no change in the particulars of jewellery possessed by the assessee on 31st March, 1972 i.e. the valuation date relevant to the asst. yr. 1972-73 and on 31st March, 1974 i.e. the valuation date relevant to the asst. yr. 1974-75 under appeal before us. The assessee is a lady and it is again found from the record and not controverted before us that the value of the jewellery based on the valuer's report dt. 29th July, 72 as on 31st March, 1972 filed for the asst. yr. 1972-73 was accepted not only for the asst. yr. 1972-73 but also for the subsequent asst. yr. 1973-74 for which the valuation date was 31st March, 1973. In these circumstances, if the assessee got the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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