1980 (7) TMI 97 - HC - Wealth-tax

Summary

Issues: Penalty for late filing of wealth-tax returns under the Wealth-tax Act, 1957.

The judgment delivered by the High Court of Punjab and Haryana involved a case where the assessee, an individual, failed to file wealth-tax returns for assessment years 1965-66, 1966-67, 1967-68, and 1968-69 within the specified deadlines. The Wealth Tax Officer (WTO) imposed penalties under section 18(1)(i) of the Wealth-tax Act for the delays. The assessee contended before the Appellate Assistant Commissioner (AAC) that the delays were due to health reasons, specifically a heart disease. The AAC upheld the penalties, finding no reasonable cause for the delays. The matter was then taken to the Appellate Tribunal, which agreed with the AAC's decision but noted that the penalties should be computed based on the law as it stood before April 1, 1969, for the years in question. The Tribunal directed the recomputation of penalties in line with the pre-amendment provisions of section 18(1)(i) of the Act. The revenue challenged this decision, leading to the High Court's consideration of whether the Tribunal was correct in directing the recomputation of penalties in accordance with the pre-amendment law.

The High Court, after considering the arguments, upheld the Tribunal's decision. It emphasized that the failure to file the returns on time constituted a completed offense once the deadline passed, and the imposition of penalties was not a recurring offense. Referring to legal precedents, including a Division Bench judgment, the Court highlighted that a fiscal statute cannot be construed retrospectively unless explicitly stated in the statute. As section 18(1)(i) of the Wealth-tax Act, as amended by the Finance Act, 1969, was not retrospective in operation, penalties had to be computed based on the law applicable at the time of the offense. The Court cited judgments from other High Courts supporting this interpretation. Consequently, the High Court answered the question of law in favor of the assessee and against the revenue, affirming the Tribunal's direction to recompute the penalties in line with the pre-amendment provisions of the Wealth-tax Act.