Law:

Section:

Section 17(1)(a) of the Gift-tax Act, 1958 - Penalty for late filing of return - Assessment year 1962-63 - Whether where infringement is said to be failure to furnish return in time, offence is complete when return is not filed on due date - Held, yes - Whether, therefore, in such a case offence having taken place on date fixed for furnishing return, law as on that date has to govern levy of penalty - Held, yes - Whether in view of aforesaid legal position, where last day of filing gift-tax return was 30-6-1962 and assessee not having filed his return on that day, had made himself liable for levy of penalty, but, amended provision of Act prescribing minimum penalty which came into force only with effect from 1-4-1963, could not be applied to assessee's case - Held, yes FACTS The assessee made a gift of certain properties to his sister. The gift attracted tax liability and the gift-tax return was due on 30-6-1962. But the return was actually filed only on 22-10-1963. The GTO completed the gift-tax assessment on 31-3-1964, and as he found that the assessee had no reasonable cause for not filing the return within the time allowed, he levied a penalty of Rs. 2,605. The AAC reduced the penalty to Rs. 1,000. The department preferred an appeal before the Tribunal and contended that the AAC erred in reducing the penalty, as the penalty levied under section 17(1)(a) by the GTO was the minimum leviable in the case. The Tribunal rejected the said contention holding that the provisions regarding minimum penalty came into force only 1-4-1963, that the default in filing the return having taken place on 30-6-1962, the provisions insisting on minimum penalty could not be applied to the assessee's case and that, therefore, there was nothing wrong in law in the action of the AAC reducing the penalty to Rs. 1,000. On reference, the department contended that so long as the language of the statute is clear, the language should be given full effect without reference to the time of the commission of the offence, that as the transgression of the law has no reference to the assessment year the penalty for non-submission of the return could only be under the law that was in force on the…

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