JUDGEMENT
Per Shri B.M.Kothari (Accountant Member) - The revenue has filed these four appeals against the common order passed by the AAC for A. Ys. 1968-69, 1969-70, 1972-73 and 1973-74 cancelling the penalties levied upon the assessee u/s. 18(1) (a) of the WT Act, 1957. -
(1.)
(2.)The brief facts relating to the aforesaid case are as under : Original assessment orders for all the aforesaid years were passed by the WTO on 30-3-1979 and penalty proceedings u/s. 18(1) (a) were also simultaneously initiated for all the aforesaid years. The Commissioner of Wealth-tax had issued show cause notices u/s. 25(2) in respect of wealth-tax assessments completed by the WTO for A. Ys. 1968-69 to 1974-75 for two items. The Commissioner passed an order u/s. 25(2) on 18-3-1981 directing the WTO to modify the assessments for A. Ys. 1968-69 to 1974-75. The concluding para-6 of the order u/s. 25(2) passed by the Commissioner of Wealth-tax is reproduced hereunder. "6. In the result, the WTO is directed to modify the assessment for the assessment years 1968-69 to 1974-75 after determining the correct value of the gold ornaments and articles of Judtar and after referring them for valuation to the Governments Approved Valued. The WTO shall, of course, give adequate opportunity to the assessee to the present her case in the this regard, before modifying the assessment in question." The penalty proceedings initiated u/s., 18(1) (a) at the time of completing the original assessments on 30-3-1979 were to get barred by limitation on 31-3-1981. However, since the Commissioner had already passed the order u/s. 25(2) on 18-3-1981 prior to the aforesaid date of limitation of time for penalty order, the WTO neither dropped the penalty proceedings nor passed any order imposing penalty u/s. 18(1) (a) with reference to penalty proceedings initiated at the time of making of the original assessment orders on 30-3-1979. The WTO passed fresh orders pursuant to the order u/s. 25(2) passed by the CWT on 29-3-1985 and once again initiated penalty proceedings under section 18(1) (a) on that date, i.e., on 29-3-1985. The WTO levied penalties for all aforesaid years under consideration u/s. 18(1) (a) vide penalty orders dated 19-3-1987.
Aggrieved by the WTOs orders imposing the penalties the assessee preferred appeals before the AAC. The AAC cancelled the penalties for all the aforesaid years. It will be worth while to reproduce para 5 of the order passed by the AAC cancelling the aforesaid penalties :- "5. The only point of consideration is whether the WTO after deciding not to levy the penalty at original assessment stage can re-initiated the penalty actions on the basis of the assessment modified under the directions of the Provisions of WT Act u/s. 25(2) of the WT Act. I have no hesitation in the deciding the issue in favour of the appellant because, the penalties once decided not to be levied at original assessment stage may be in an implied manner, cannot be re-initiated and levied at the stage of modification of that original order. Since the penalty actions had got time-barred on 31-3-1981 and penalties were not levied till then, it was not open for the WTO, to re-initiated penalty proceedings subsequently at the time of modification of the original assessment."
(3.)THE revenue has preferred appeals against the aforesaid orders passed by the AAC cancelling the penalties for all the aforesaid years and have raised the following common grounds of appeal in all these appeals : (1) On the facts and in the circumstances of the case and in law, the learned AAC erred in deleting the penalty levied under section 18(1) (a) of the Wealth-tax Act. (2) On the facts and in the circumstances of the case and in law, the learned AAC ought to have upheld the order of the WTO.
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