COMMISSIONER OF INCOME TAX Vs. JANGI LAL

JUDGEMENT

(1.) The Tribunal had referred the following questions of law under Section 27(1) of the WT Act, hereinafter referred to as the Act, for opinion to this Court :

(2.) Briefly stated, the facts giving rise to the present reference are as follows : The assessee is Jangi Lal HUF. For the assessment years in question returns of wealth became due on the 30th of June each year. However, all the returns were filed by the assessee on 31st Dec., 1975 on which date the assessee also made Voluntary Disclosure of Wealth for those years under Section 15(1) of the Voluntary Disclosure of Income and Wealth Ordinance, 1975, later on enacted as the Voluntary Disclosure of Income and Wealth Act, 1976, hereinafter referred to as the Act of 1976. The disclosures upto the asst. yr. 1966-67 were in the status of individual but from the asst. yr, 1967-68 onwards they were in the status of HUF. The WTO initiated penalty proceedings under Section 18(1)(a) of the Act. The explanation of the assessee was that no penalty was leviable as the returns were filed in pursuance of the disclosure made under the Act of 1976 and that full tax had been paid on 30th March, 1977 under Section 15(5) of the Act of 1976 during the extended time allowed under Section 5A thereof. However, the WTO did not accept this explanation observing that the said disclosure had not been accepted by the Department. Accordingly, penalty was imposed on the assessee for all these years in varying amounts.

(3.) The assessee appealed before the AAC. There, an alternative contention was also raised on behalf of the assessee, namely, that it had come in disclosure with trust and, therefore, penalty should not have been levied at least on the value of the wealth declared under Section 15 of the Act of 1976. However, the AAC did not interfere with the order of the WTO on the ground that it was in the sole discretion of the WTO to accept or not to accept them to be declarations and that since he did not accept them to be full and true, no discretion could be given to him to grant immunity to the assessee. The AAC also did not accept the alternative submission raised before him.