Law: Wealth Tax Act, 1957

Section: 27(3),18(1)(a)

Wealth Tax--- ----Penalty---Delay in filing returns---Finding that default was not deliberate--­Penalty cannot be imposed---Indian Wealth Tax Act, 1957, S. 18(1)(a). The Tribunal found that the assessee was a minor, who attained majority only in 1969; that the guardian was looking after his affairs and in 1967 the guardian intimated the Wealth Tax Officer about the liability-to pay wealth tax and had voluntarily made a payment of Rs.4,500; that there was no intention to avoid payment of tax or not to comply with the statutory regulations; that there was no doubt a lapse after 1967 and the wealth tax returns were filed only after issue of notice under section 17 of the Wealth tax Act, 1957. However, even if the lapse could be construed as a default it was only a technical or venial breach. The Tribunal cancelled the penalty under section 18(1)(a) of the Act. On a reference: Held, that the Tribunal had given sufficient reasons for coming to the conclusion that the default was only venial. The tribunal was correct in holding that penalty could not be imposed under section 18(1)(a). Hindustan Steel Ltd. v. State of Orissa (1972) 83 ITR 26; (1970) 25 STC 211(SC) applied. CGT v. C. Muthukumaraswamy Mudaliar (1975) 98 ITR 540 (Mad) and CIT v. Kalyan Das Rastogi (1992) 193 ITR 713 (SC) ref. JUDGMENT VENKATASWAMI, J: -- 1n all these tax cases the assessee is common. Common arguments were addressed and, therefore, the cases are disposed of by this common order. Pursuant to the order of this Court under section 27(3) of the Wealth Tax Act, 1957, the Tribunal referred the following common question for our decision: "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding and had valid materials to hold that the assessee's case does not warrant levy of penalty under section 18(1)(a) of the Wealth Tax Act, 1957?" The brief facts leading to the reference are the following : The cases relate to the assessment years 1963-64 to 1969-70. On March 30, 1967, the assessment representative wrote a letter to the Wealth Tax Officer informing him that the wealth tax returns for the assessment years 1962-63 to 1966-67 were due and that it…

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