(1.) DALJIT Singh, the assessee, filed his wealth-tax return for the assessment year 1969-70 after some delay. The WTO issued a notice to him for late filing of the return under Section 14 (1) of the W. T. Act, 1957 (hereinafter referred to as "the Act" ). After giving an opportunity of being heard to the assessee, he imposed a penalty of Rs. 5,934 on him on account of the delay in filing the said return.
(2.) THE assessee went up in appeal, which was dismissed. The assessee filed a second appeal before the Income-tax Appellate Tribunal, Chandigarh Bench (hereinafter referred to as "the Tribunal" ). Before the Tribunal two points were raised on behalf of the assessee. Firstly, it was submitted that the assessee was an agriculturist by vocation and as such he was not conscious of his legal obligation to furnish annual returns of his net wealth. Secondly, it was submitted that the assessment having been started and completed on the basis of a return furnished under Section 14 (2) of the Act, penalty under Section 18 (1) (i) of the Act could not be imposed for any assumed delay in the furnishing of a return under Section 14 (1) of the Act.
(3.) ON the first point, the Tribunal held that the assessee was engaged as a partner in a firm functioning at Muktasar in the name and style of M/s. Bharat Cotton Ginning and Pressing Factory, and that he had engaged an advocate for filing the income-tax returns of this business as well as the returns of his net wealth. For these considerations, the decision on the first point was given against the assessee. On the second point, the Tribunal noticed Commr. of Agrl. I. T. v. Sultan Ali Gharami [1951] 20 ITR 432 (Cal) and held: ". . . we are of the view that in the assessment proceedings initiated arid completed on the basis of Section 14 (2), Wealth-tax Act (return), it was not open to the Wealth-tax Officer under Section 18 (1) (i) to penalise the assessee for the default of his failure to furnish the Section 14 (1) return. We would add that, as a matter of fact, the assessee never furnished any return under Section 14 (1); that total failure to furnish a return under Section 14 (1) is not punishable under Section 18 (1) (iv) as there could not be a best judgment assessment except after service of a notice asking for a return under Section 14 (2), Wealth-tax Act; that in the assessment made on the basis of a return received after service of such a notice under Section 14 (2), the assessee could be penalised for delay in furnishing Section 14 (1) return only in a case where the revenue definitely establishes it as a fact that the return furnished by the assessee was not one filed in compliance of Section 14 (2) notice but one filed in compliance of the statutory obligation under Section 14 (1 ). "