Law:

Section:

Section 18(1)(c) of the Wealth-Tax Act, 1957 - Penalty - For concealment of income - Assessment year 1967-68 - Return of wealth-tax for assessment year in question was filed on 24-7-1968 - Authorities assessed properties at higher amount and imposed penalty under section 18(1)(c) in accordance with law as it existed on 24-7-1968 - Whether law applicable for imposition of penalty was law as in force on date of filing return - Held, yes - Whether, therefore, penalty under section 18(1)(c) to be imposed on assessee was to be governed by amended law which came into force with effect from 1-4-1968 and not by law which was in force on first day of assessment year in question - Held, yes FACTS For the assessment year in question the assessee filed his return of wealth on 24-7-1968 showing certain value of assets. However, WTO assessed the immovable properties at higher amount. The WTO also initiated proceedings under section 18(1)(c) and referred the matter to the IAC. The IAC imposed the penalty upon the assessee in accordance with law as it existed on 24-7-1968. On appeal, the Tribunal held that the IAC had erred in law in imposing penalty in accordance with the law as it existed on 24-7-1968 on ground that the quantum of penalty imposable was to be governed by law which was in force on the first day of the assessment year in question and not the amended law which came into effect from 1-4-1968. On reference: HELD In view of the decision of the Supreme Court in Brij Mohan [1979] 120 ITR 1, wherein it was held that penalty is imposed on account of the commission of a wrongful act and, therefore, the law prevailing on the date on which the wrongful act was committed would be the law which was to be applied and in accordance with which the penalty was to be imposed, it was to be held in the instant case, that the return of wealth having been filed on 24-7-1968, the law applicable on that date was the law which was in force on that date. The law underwent a change from 1-4-1968. The law, therefore, which was in force on 24-7-1968, would govern the case. The IAC was thus absolutely justified in the order that he had passed and the Tribunal erred in applying the law which…

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