TMI Blog2006 (10) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the order of the Tribunal in the wealth-tax appeals of the petitioner for the assessment years 1983-84 to 1986-87 is the following : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the penalty proceedings were valid in view of section 42C inserted in the Wealth-tax Act ?" 2 The petitioner who did not file wealth-tax returns for the above assessment years was served with separate notices under section 18(2) of the Wealth-tax Act proposing to levy penalty under section 18(1) of the said Act. Since the petitioner did not respond to notices, fresh notices were issued on October 16, 1989, against which petitioner filed replies stating that he could file returns only by Octo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring for the respondent. 4 Since the defective notice, which is the sole basis of reference case is not an annexure in the reference case before us, we requested counsel for the petitioner to produce a copy of the notice and he has produced original of the same before us. We find from the notice that it is in printed form and is one issued under section 18(2) of the Act. The proposal in the ultimate portion of the notice is to levy penalty under section 18(1) of the Act. Three situations are covered by the notice, which can obviously be alternative or cumulative. The first one is failure to file return, the second one is failure to comply with notice issued under section 16 and the third one is for concealment of particulars of net weal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... single Bench decision of this court does not apply to this case and in any case it has to be overruled based on the decision of the Division Bench of the Andhra Pradesh High Court abovereferred. Alternatively, he con tended that the defect, if any, in the notice proposing penalty is so insignificant and its validity is therefore protected by virtue of operation of section 42C of the Act which came into force by introduction of the Taxation Laws (Amendment) Act, 1975, with effect from October 1, 1975. Since the Tribunal has upheld the penalty proceedings by reference to section 42C and the question referred is also with reference to the section, we extract hereinbelow section 42C for easy reference : "42C. Return of wealth, etc., not to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Even though reply to the notice is not produced, the Assessing Officer while issuing penalty has stated that the petitioner has explained the delay in filing the return as on account of search conducted by the Income-tax Department in his business premises. Therefore, not only that the officer has issued the notice as one proposing penalty for failure to file return, but the assessee has also understood it in the same manner and has replied answering the allegation on merits. In this case, petitioner himself admits that he has not filed return under section 14(1) but has filed a belated return against a notice under section 17 of the Act. Therefore, it is obvious that penalty proposed is for not filing the return in terms of requirement o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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