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TMI Blog1992 (10) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee in W.T.R. No. 2 of 1979 and Valimohmed Rahimtulla, the assessee in W.T.R. No. 3 of 1979 are neither citizens of India nor residing in India. However, they had received income in India from the advances made to or deposits kept with Dilawar Syndicate (P) Ltd., Junagadh. On May 14, 1971, Dilawar Syndicate (P) Ltd. filed returns for all the three assessees for the assessment years 1963-64 to 1970-71. While passing the assessment orders, the Wealth-tax Officer also passed orders for issuance of show-cause notices under section 18(1)(a) of the Wealth-tax Act, 1957 (" the Act "), for late submission of the returns. Those notices were not replied to and in the absence of any explanation on behalf of the assessees, orders for levying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re not served, the Appellate Assistant Commissioner held that notices were served upon B.M. Ratiya of Dilawar Syndicate (P) Ltd., as authorised representative of the assessees. Ratiya had represented the assessees during the assessment proceedings and, therefore, it was not correct to say that show-cause notices were not properly served. He also held that Dilawar Syndicate (P) Ltd. had acted as agent of the assessees right from 1946 and, therefore, it was not correct to say that only when their attention was drawn by their tax consultant they realised that they had to file the returns. He, therefore, dismissed the appeals and confirmed the orders passed by the Wealth-tax Officer. Aggrieved by the orders passed by the Appellate Assistant Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed return of net wealth of the person residing abroad without receipt of notice under section 22(2) of the Wealth-tax Act, 1957, was not liable to be penalised under section 18(1) of the Wealth-tax Act, 1957 ? " As the said questions do arise out of its orders, the Tribunal has referred the same to this court for its opinion. What is contended by learned counsel for the Revenue is that the Tribunal has committed an error of law in holding that without service of notice under section 22(2) of the Act, no person could be held liable to file the return of net wealth of a person residing outside India and that he cannot be made liable to pay penalty under section 18(1)(i). Before we refer to the relevant provisions of law, it would be pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fies different persons who can be regarded as agents of the assessee. It provides that (i) any person employed by or on behalf of a person liable to pay tax under the Act but residing outside India ; (ii) any person through whom such person that is the person residing outside India liable to pay tax under the Act, is in receipt of any income, profits or gains ; or (iii) any person who is in possession or has custody of any asset of such person that is the person residing outside India liable to pay tax in India. However, this sub-section further provides that before treating any such person as an agent, the Assessing Officer should cause a notice to be issued of his intention of treating him as an agent of such person. If such notice is iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mbay High Court in the case of Jadavji Narshidas and Co. v. CIT [1957] 31 ITR 1. This was a case under the Indian Income-tax Act, 1922. Though the relevant provisions of that Act and the provisions with which we are concerned cannot be said to be identical, the observations made in that decision can usefully be applied to this case also. Therein, the High Court has held that as the assessee made the return without being called upon to submit a return by notice under section 22(2) and in that return he admitted the status as an agent of the non-resident, non-service of notice was of no consequence. The High Court observed that once he filed the return as agent, without being called upon to do so, he admitted his status as agent. The Bombay H ..... X X X X Extracts X X X X X X X X Extracts X X X X
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