Law:

Section:

Section 31 of the Wealth tax Act, 1957 - Collection and recovery of tax - Assessment year 1957-58 - Whether power to stay or not, granted under section 31(3) is a matter of discretion to be exercised judiciously - Held, yes - Application of petitioner assessee not to treat him as defaulter till disposal of appeal by AAC was rejected by WTO - Right from time of notice of demand, intimation was given that stay would not be allowed under any circumstances - Further, explanation given by WTO in affidavit in opposition did not establish that he applied his mind judiciously to question or that he considered all possible aspects of matter that were relevant before passing order of rejection - Whether, on facts, impugned order of rejection by WTO was to be quashed and set aside - Held, yes [matter remanded to WTO for consideration afresh] FACTS The WTO issued a notice under section 14(2) calling upon the petitioner to submit a true and correct statement of the petitioner's assets and liabilities as on the relevant valuation date for the purpose of the Act. The petitioner submitted its return and the assessment order was made by the WTO. Thereafter, the WTO issued a notice of demand under section 30. The petitioner was asked to pay the demanded amount on or before 18-3-1958 with a note underneath the demand notice that the collection of taxes would not be postponed under any circumstances. It was also notified that if the petitioner intended to appeal against the assessment, he should present the appeal under section 23(1) to the AAC. Eventually the petitioner filed an appeal on or about the 21-3-1958, before the AAC. An application was made to the Commissioner, praying for a direction to the WTO not to treat the petitioner in default till the disposal of the appeal. The Commissioner rejected the application without giving any reason whatever for the refusal. Thereafter, an application was made before the WTO stating that the petitioner had filed an appeal under section 23 and requested him not to treat the petitioner as in default. By his letter dated the 24-3-1958, the WTO refused or rejected this prayer and called upon the petitioner to pay the assessed amount on or…

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