Gulati, J. - (1.) THIS is a petition under Article 226 of the Constitution.
(2.) THE petitioner, Behari Lal, runs a business in the name of M/s. Kundan Lal Behari Lal at Chandausi of which he is the sole proprietor. He is being assessed to income-tax in the status of an individual. He, however, was not being assessed to wealth-tax. It has been alleged by the petitioner that on 20th November, 1971, he went to his counsel in connection with his case under the Income-tax Act for the year 1969-70, when he was told by his counsel that he was liable to wealth-tax. On the following day when he appeared before the Income-tax Officer in connection with the income-tax assessment for the year 1969-70, he informed the Income-tax Officer, who was also the Wealth-tax Officer, that he would be submitting his wealth-tax return for the years 1964-65 to 1970-71, according to the legal advice given to him. He goes on to say that the wealth-tax returns for the aforesaid years were prepared on the 28th November, but they could not be finalised on that day and were filed on December 2, 1971. As the returns were not filed within the time allowed under Section 14(1) of the Wealth-tax Act, he applied to the first respondent, the Commissioner of Wealth-tax, Lucknow, on December 3, 1971, for waiver of penalty for filing the returns late, as provided under Section 18(2A) of the Wealth-tax Act. On December 6, 1971, he was served with a set of six notices under Section 17 of the Wealth-tax Act all dated November 29, 1971, issued by the second respondent, the Wealth-tax Officer, Chandausi, for the years 1965-66 to 1970-71. THE returns already filed were accepted and he was assessed to tax by the Wealth-tax Officer by his order dated January 24, 1972. THEreafter, the petitioner's application under Section 18(2A) was taken up by the Commissioner and was finally disposed of on September 7, 1972. THE Commissioner found that as no notice under Section 17 had been issued by the Wealth-tax Officer for the assessment year 1964-65, the return filed by the petitioner for that year was a voluntary return containing a full and true disclosure of his wealth. He, accordingly, waived the penalty for that year. With regard to the remaining years the application was rejected on the ground that the returns filed by the petitioner had been filed after the notice under Section 17 had been issued to him and as such the petitioner was not entitled to any relief by way of waiver or reduction of penalty. He, accordingly, directed the Wealth-tax Officer to proceed with the penalty proceedings for these years in accordance with law. This order of the Commissioner has been challenged in this petition. Before dealing with the contentions raised on behalf of the petitioner, it is necessary to notice the relevant statutory provisions. Under Section 14(1) every person is required to file a return voluntarily of his net wealth before the 30th day of June each year, if his net wealth is of such an amount as to render him liable to wealth-tax. Section 18(1) then provides for the imposition of penalty, if an assessee fails to file a return under Section 14(1) or fails to furnish it. within the time allowed. Sub-section (2A) of Section 18 empowers the Commissioner to reduce or waive such penalty under certain circumstances. That provision reads : "(2A) Notwithstanding anything contained in Clause (i) or Clause (iii) of Sub-section (1), the Commissioner may, in his discretion,-- (i) reduce or waive the amount of minimum penalty imposable on a person under Clause (i) of Sub-section (1) for failure, without reasonable cause, to furnish the return of net wealth which such person was required to furnish under Sub-section (1) of Section 14, or (ii) reduce or waive the amount of minimum penalty imposable on a person under Clause (iii) of Sub-section (1), if he is satisfied that such person- (a) in the case referred to in Clause (i) of this sub-section has, prior to the issue of notice to him under Sub-section (2) of Section 14, voluntarily and in good faith, made full disclosure of his net wealth; and in the case referred to in Clause (ii) of this sub-section has, prior to the detection by the Wealth-tax Officer of the concealment of particulars of assets or of the inaccuracy of particulars furnished in respect of the assets or debts in respect of which the penalty is imposable, voluntarily and in good faith, made full and true, disclosure of such particulars; (b) has co-operated in any enquiry relating to the assessment of the wealth represented by such assets; and (c) has either paid or made satisfactory arrangements for payment of any tax or interest payable in consequence of an order passed under this Act in respect of the relevant assessment year."
(3.) THE petitioner has challenged the impugned order passed by the Commissioner on the following grounds : (i) That when the petitioner had informed the Wealth-tax Officer on 29th of November, 1972, that he would be filing his wealth-tax returns, he had made a full disclosure of his wealth before the notices under Section 17 were issued to him and as such he was entitled to that benefit by way of waiver or reduction of penalty. (ii) That the notices under Section 17 must have been issued by the Wealth-tax. Officer after the petitioner had filed his returns on December 2, 1972, and had been ante-dated. (iii) That no notices under Section 14(2) were issued to him as contemplated by Clause (2A) of Section 18. (iv) That the word "issue" occurring in Section 18(2A) means "serve" and as he had filed the returns before the notices were served on him, he was entitled to the benefit contemplated by Section 18(2A). Before dealing with these contentions, it is necessary to dispose of a preliminary objection raised by the learned counsel for the department. He says that the power enjoyed by the Commissioner under Section 18(2A) is a discretionary power and the same cannot be challenged unless it is shown that it has been exercised arbitrarily. He also argued that the order contemplated by this provision is an administrative order and is not amenable to the writ jurisdiction of this court under Article 226 of the Constitution.;