COMMISSIONER OF WEALTH TAX Vs. MANGALAMMA

JUDGEMENT

(1.) These are references made by the I.T. Appellate Tribunal, Bangalore Bench, Bangalore, under S. 27(1) of the Wealth-tax Act, 1957 (hereinafter referred as the 'Act'). The question relates to the quantum of penalty imposable for the failure to file the return of wealth-tax within the time prescribed or within the time extended in accordance with law. Though the actual question referred in these several cases is somewhat different, the substance of the matter is one and the same. The question referred in T.R.C. 195 of 1977 is as follows :-

(2.) The penalty under the Act is imposable for a contravention or failure to fulfil the requirements of the law in regard to the filing of the return. The penalty, as the section itself speaks, is in respect of the failure to furnish the return without reasonable cause. The failure refers to the last date on which the return was due to be filed which would normally be 30th of June or such other date specified in the notice under S. 14(2) or the last date of the period up to which time may have been extended by the Wealth-tax Officer. The penalty gets crystallised as on the expiry of last date of the period within which the return was due to be filed and the default occurred. Therefore, the penalty imposable is on the basis of the provision as in the operation as on the expiry of the last day of the period within which the return was due to be filed, unless it is provided otherwise by an express provision of the law. Merely because the provision was altered from time to time, the date of default, and therefore, the date of incurring liability does not get changed nor does the quantum of penalty get varied. The amendment made in 1969 is not with retrospective effect and cannot in any way affect the liability which got crystallised earlier to its coming into force. This view of ours gets support from the decision of High Court, Madras, reported in Commissioner of Gift Tax vs. C. Muthukumaraswamy Mudaliar under the Gift Tax Act, in relation to an identical provision; in Commissioner of Wealth Tax, Lucknow vs. Ram Narain Agrawal, of the High Court of Allahabad and in Commissioner of Wealth Tax, Hyderabad vs. R. D. Chand, of Andhra Pradesh High Court and in Suresh Seth vs. Commissioner of Wealth Tax, of Punjab and Haryana High Court.

(3.) Accordingly, we answer the question referred to us as follows : The quantum of penalty should be calculated in accordance with the law in force as on the expiry of the last date of the period within which the return was due to be filed for the relevant assessment year.