COMMISSIONER OF WEALTH TAX Vs. SARASWATI DEVI

JUDGEMENT

(1.) THIS batch of four cases are references made under Section 27(1) of the W.T. Act, 1957 (hereinafter referred to as "the Act"). The Income-tax Appellate Tribunal, Patna Bench 'A', Patna, has submitted a consolidated statement of the case and invited our decision with regard to a common question arising out of the assessment orders for the four years being assessment years 1965-66, 1966-67, 1967-68 and 1968-69. The questions referred for our decision are:

(2.) THOUGH the Commissioner of Wealth-tax has made separate application for each year, the Tribunal proceeded to draw up a consolidated statement of case as stated above.

(3.) THE only point that deserves our consideration to answer the question posed before us is as to whether the Tribunal was right in taking the view that the amendment could not have any retrospective effect and could not apply to the assessment year prior to the assessment year 1969-70. THEre can be no doubt even as a matter of first impression that the view taken by the Tribunal was correct. THE nature of the aforesaid amendment inserted in the year 1969 under Section 24 of the Finance Act affects prejudicially the financial liability of the assessee and there can be no manner of doubt that any statutory provision affecting substantive rights of the assessee, unless expressly stated by the statute itself or by necessary intendment, can have no retrospective operation. THE legal principle apart, this has now been settled by the Supreme Court in the case of CWT v. Suresh Seth [1981] 129 ITR 328. In that case, the Supreme Court held that the default cannot be one committed every month after the last date on which the return had to be filed and in determining the quantum of penalty, the multiplier to be adopted cannot have any effect of making the default a continuing one. Nor do they make the amended provisions modifying the penalty applicable to earlier defaults in the absence of necessary provisions in the amending Acts. THE principle underlying s. 6 of the General Clauses Act is made applicable to such cases. It was, therefore, held by the Supreme Court in that case that where the default complained of was one falling under Section 18(1)(a) of the Act, penalty had to be computed in accordance with the law in force on the last day on which the return in question had to be filed. Neither the amendment made in 1964 nor the amendment made in 1969 had any retrospective effect. THE question posed before us, therefore, has already been answered by the Supreme Court on principle in Suresh Seth's case [1981] 129 ITR 328 (SC), wherein it has been categorically held that the amendment made in 1969 had no retrospective effect. In that view of the matter, we come to the conclusion that the Tribunal had correctly applied the principle for the computation of the quantum of penalty in each of the cases before us. THE questions referred for the respective years are, therefore, answered in the affirmative, in favour of the assessee and against the Revenue.