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TMI Blog1978 (5) TMI 50X X X X Extracts X X X X X X X X Extracts X X X X ..... rns were thus late by 56 months for the asst. yr. 1966-67 and by 44 complete months for the asst. yr. 1967-68. The WTO initiated the penalty proceedings. The assessee's explanation was that the account books of the firm M/s Golden Iron & Steel Works, in which the assessee was one of the partners, were seized for the various years (including books of the firm for the year ending 31st March, 1968 being unclosed) on 23rd May, 1968 during a course of search conducted b the Directorate of Intelligence (Income Tax) at the firms premises and that the firm approaching the CIT, a settlement was arrived at in Oct., 1970 and that the books of accounts were returned on 4th Dec., 1970 when the job compiling figures for the various years was taken up by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee did not choose to do so. On these facts, the WTO considered that the assessee had, without reasonable cause, failed to the file the returns in time for both the years. He levied a penalty of Rs.4,210 for the year 1966-67 which was worked out as under; Assessed Wealth Rs. 1,35,838 Taxable Wealth Rs. 35,838 Penalty @ 2 per cent per month of wealth tax of Rs.179 from1st July 1966to31st March 1969restricted to 50 per cent of the wealth tax Rs. 89 Penalty @ 1 per cent per month of net wealth assessed of Rs. 35,838 from1st April, 1969to27th February, 1971i.e., for23 months Rs. 4,121 . Rs. 4,210 For the asst. yr. 1967-68, he worked out the penalty of Rs. 6,788 as under : Assessed wealth Rs. 1,57,971 Taxable wealth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and that the assessee could not take the plea that he was unaware of his true income and/or wealth. The AAC confirmed the penalty levied for the year 1966-67 and for the same reasons he upheld the penalty levied for the year 1967-68. As for the other years 1968-69 to 1971-72, the AAC cancelled the penalties. The arguments advanced before him were that the books seized were written upto31st March,1968and that at the time of seizure in May, 1968, these were still unclosed and that these were returned only in December, 1970. The firm had filed the returns for the first two years (1968-69 and 1969-70) in March,1971, for the third year (1970-71) in April, 1971 and for 1971-72 in December, 1971. It was stated that the wealth-tax returns of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the personal returns of the partner were delayed due to the belated receipt of share-income of the firm, no penalty under s. 271 (1)(a) was leviable in the case of the partners. It was further submitted before the AAC that the WTO had also denied the extension of time asked for from him. The AAC considered that for the purpose of determining whether a case fell within the ambit of s. 18(1) (a), all that had to be seen was that the return of wealth should have been delayed and that there should have been no reasonable cause for the delay. According to the AAC, in this case, it was an undisputed fact that the books of accounts of the firm had been seized by the Directorate of Intelligence (Income-tax) and that the books of account for the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e filing of the returns was a continuos default as it ended only when the returns were filed on29th March,1971for these two years. 5. We have heard the parties and considered the matter. We find that an identical question had come up for consideration before the Delhi Bench 'A' of the Tribunal in which one of us was a party, and that Tribunal held by its order dt. 25th Nov., 1977 in ITA No. 37 (Del) 76-77 pertaining to the asst. yr. 1967-68 (in that case only one year was involved) that the delay in the filing of the return was because of contumacious conduct on the part of the assessee and in this regard the Tribunal had there agreed with the authorities below that penalty was leviable. For the same reason as recorded in the said order of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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