TMI Blog1990 (3) TMI 121X X X X Extracts X X X X X X X X Extracts X X X X ..... ation. One property is located at Jaiaw which the WTO found that the assessee had not disclosed the same on the ground that she was not the owner of the property. Another property is a godown at Barabazar was also not shown on the ground that the land belonged to Syiem of Mylliem and for which she is to pay rent and, therefore, the assessee is not the owner of the land and the value was, accordingly, not shown in the return. The WTO found that on the above Barabazar land taken on rent, the assessee has raised an Assam type godown of 150 sq.ft. and, therefore, he held that the value of this structure should have been disclosed by the assessee. 3. The WTO also found that the land at Cantonment was purchased by the assessee from one Shrimati Uma Rani Chakraborty for Rs. 80,000 on 21-9-78 and, therefore, the contention of the assessee that the value would be Nil was not acceptable. 4. In respect of the Jaiaw property the WTO noted that it was exclusively enjoyed by the assessee who had made extension to the building, the assessee claimed that the Jaiaw property belonged to the clan and not to the assessee. The WTO pointed out that the assessee has not shown that any other member of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o member of clan is co-owner with her. The CWT(A), therefore, concluded that the WTO was justified in imposing the penalty under section 18(1)(c) for all the years. No interference is made by the CWT(A). Hence, these appeals by the assessee. 8. We have heard both the sides at length and we have gone through the orders of the authorities below for our consideration. The assessee's learned counsel reiterates and placed emphasis on various points as made out before the authorities below in respect of the various items included in the assessment. On the query made by the Bench, it is stated that the assessee had accepted the assessment orders possibly in order to buy peace. Be that as it may, the submissions of the assessee are that there was no contumacious conduct or no mala fide intention on the part of the assessee to conceal any wealth or to furnish inaccurate particulars thereof. In short, it is urged that on the facts of the case, the penalty for all the above years was not justified, specially when the assessee has co-operated all throughout to the extent possible and had in fact accepted the order of the assessing officer though not factually acceptable to the assessee. 9. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeals by the assessee. 13. On appeal before the CWT(A), same arguments were reiterated and the CWT(A) was of the opinion that the assessee was not prevented by reasonable cause in not filing the return in time. The CWT(A) placed reliance on the decision of CIT v. Shanta Electrical Industries [1986] 160 ITR 774 (Delhi). He, therefore, confirmed the orders of the WTO for both the years. 14. As mentioned earlier, it appears that there is no pending appeal in respect of the quantum. Here, also, we have heard both the sides and we have gone through the orders of the authorities below for our consideration. It is seen that as far the penalty under section 18(1)(a) is concerned, the CWT(A) relied on the decision of the Hon'ble Delhi High Court in the case of Shanta Electrical Industries. Amongst other things, it was held that onus of proof of reasonable cause was on the assessee. But the Hon'ble Gujarat High Court (FB) in the case of Addl. CIT v. I. M. Patel Co. [1977] 107 ITR 214 has taken contrary view to the effect that the burden to show that there was reasonable cause for late filing of the return lies with the department and that burden has to be initially discharged by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... very careful in filling up the return to avoid penal consequences. In doing so, it could not be said that the assessee has deliberately delayed in filing of return without reasonable cause. In our opinion, the cause shown by the assessee in the present case for the years under consideration was reasonable. In the circumstances of the case, penalty was not warranted. Thus, from whatever angle we may look at the problem, we are satisfied that the penalty for both the years under section 18(1)(a) was not warranted. The orders of the authorities below on the point are cancelled. 15. Coming now to the appeals relating to the penalty orders under section 18(1)(c) for the years under consideration. As mentioned above, we are to say that the WTO has passed a detailed order for the assessment year 1979-80 and identical orders were passed for other years. After hearing both the sides and after we have gone through the findings of the authorities below in their respective orders, it is seen that the first item of the property involved was regarding the property at Jaiaw, which was stated to have not been disclosed in the return filed by the assessee as according to her the same did not belo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee for the purpose of her wealth-tax assessment. In view of what we have discussed above, it is quite clear that if the property of the clan did not constitute the property of the individual members, then such property cannot be said to be belonged to such individual members. In this connection, it would be helpful to refer to a decision of the Hon'ble Supreme Court in the case of CWT v. Bishwanath Chatterjee [1976] 103 ITR 536, in which amongst other things and on the facts of that case, it was held that liability to wealth-tax arises out of ownership of the asset and not otherwise, as mere possession or joint possession without right to or ownership of property would not be sufficient as such property were not 'belonging' to the assessee. 16. In a slightly different context in the case of R.B. Jodha Mal Kuthiala v. CIT [1971] 82 ITR 570 the Hon'ble Supreme Court dealing with section 9 of the Indian Income-tax Act, 1922, on the facts and in the context of that case held that the ownership must be the person who can exercise the rights of the owner, not on behalf of the owner but in his own right. That decision was for the purpose of assessing income from the property. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Department at any time without payment of any compensation. The WTO pointed out that the assessee herself has purchased this asset from one Smt. Uma Rani Chakraborty on 21-8/9-1978 for Rs. 80,000. It appears that it was a lease obtained by Smt. Chakraborty from the Defence Ministry and the lease was purchased by this assessee from Mrs. Uma Rani Chakraborty. There are no further details available. In other words, the lease must have been for a certain stipulated time as the Defence Department would not have given a perpetual lease, particularly when it may require land for defence purposes at any time and is not obliged to pay any compensation. Besides, some years must have elapsed from the time when Mrs. Chakraborty obtained the lease from the Cantonment authority till the time when this assessee bought this property. In other words, the period of the lease had expired to some extent and thereby leaving shorter period of the unexpired period of the lease. A leasehold right may have a market value as observed by the CWT(A) in the impugned order. But he has lost sight of the fact that the value of periodical lease would be diminished as it approaches expiry date. Thus, the market val ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this property in her return for the assessment years 1985-86 and 1986-87. The year with which we are presently concerned is 1979-80. The WTO, therefore, held that the claim of the assessee that this property belonged to the clan was not acceptable. On appeal by the assessee, the CWT(A) did not agree with any of the contentions of the assessee as discussed in the earlier paragraphs. 20. We have gone through the orders of the authorities below for our consideration along with the submissions made by both the sides. In respect of the Jaiaw house property, the assessee submitted that the property belonged to the clan and not to her. The WTO declined to accept the contention as the assessee herself had shown this property in her wealth-tax return for the assessment years 1985-86 and 1986-87. Hence, the penalty was imposed on this point, which was sustained by the CWT(A) on the same reasonings. In our opinion, as far as this property is concerned, the penalty was imposed on irrelevant material. In taxation matters, each year is independent. It is highly unjustified to penalise or to make an assessment of a particular year on the basis or on the material available for any subsequent yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urn, the same should be taken as belonging to her. Each fact will have to be considered in its own setting. At the same time, penalty cannot be imposed for this year on the ground that for the assessment year 1985-86, the assessee had shown such wealth in the return. 24. As indicated earlier, there is no appeal pending in respect of the quantum. In other words, the assessment has become final. As pointed out by the revenue, the assessee had accepted the assessment orders. But that by itself would not be sufficient to hold or to infer that the assessee had admitted that such property belonged to her, assessable in her hands and for concealment of which, penalty was leviable. Admission or acceptance of certain point should be a qualified one as there could be many reasons as to why such acceptance was made. There were cases under the income-tax proceedings in respect of cash credit etc., and the explanation of the assessee was not considered proper and the assessee agreed that those amounts may be taxed, with a view to purchase peace or to avoid botheration. For such proposition, we may refer to certain decisions in CIT v. Narang Co. [1975] 98 ITR 462 (Delhi), CIT v. M. Bhuta C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceedings are similar with those of the income-tax proceedings. The Hon'ble Punjab and Haryana High Court in the case of Krishan Lal Shiv Chand Rai v. CIT [1973] 88 ITR 293, held that on the facts of that case that penalty proceedings are distinct from the assessment proceedings and are in the nature of quasi-criminal proceedings and that the onus was on the department to prove positively and produce other materials besides the factum of surrender that the amounts in dispute were the undisclosed income of the assessee as the surrender by the assessee could have been for more than one reason in spite of the fact that is was not his income and that fact alone could not be the basis for imposition of penalty. Similar view was expressed by the Hon'ble Andhra Pradesh High Court in the case of C. V. C. Mining Co. as dealt with by us earlier. 26. In a different context and under the provisions of the Central Sales-tax Act, 1956, the Hon'ble Supreme Court in the case of Cement Marketing Co. of India Ltd. v. Assistant Commissioner of Sales-tax [1980] 124 ITR 15 has on the facts of that case, held that a return can be 'false' unless there is an element of deliberateness in it. It was obse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ugh such asset was deemed to have passed on the death of the deceased, yet the benefits accruing therefrom was not liable to estate duty. 29. Thus from whatever view we may look at the various contentions of both the sides, vis-a-vis, the position of law, as dealt with by different High Courts and Supreme Court, we find that there was no concealment of particulars in the present case as we do not find any material even to infer that the assessee had deliberately or mala fide declined to include such items of assets in her wealth-tax return, although the WTO did not accept the contentions of the assessee that such properties did not belong to her. 30. Although the assessee in the present case had not preferred appeal against the quantum orders for the years under appeal, it could not be said that the assessee has estopped from asserting her right in penalty proceedings as there is no estoppel against the statute. In the case of C.K. Mehta [1982] 2 SCR, Part I (sic) the Hon'ble Supreme Court observed on the facts of that case that there is marked difference between the assertion and estoppel. It was observed that a man is not estopped from asserting a right which he had stated th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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