- (1.) THIS is an application under Section 27(3) of the Wealth-tax Act, 1957, praying that this court should call for a reference framing a question of law as to whether, on the facts and in the circumstances of the case and in law, the Tribunal was justified in deleting the penalty under Section 18(1)(a) on account of technical default on the part of the Wealth-tax Officer and in not deciding the issue on the merits of the case.
(2.) DURING the assessment year 1974-75, in the course of assessment proceedings, the Wealth-tax Officer initiated proceedings under Section 18(1)(a) for the default of late filing of return by 29 months. A show-cause notice was issued to which a reply was submitted by the assessee-respondent. The assessee had prayed that the order of the Income-tax Appellate Tribunal in the main proceedings may be summoned before deciding the question of imposition of penalty. Before the order could arrive and the matter can be heard, the Wealth-tax Officer who issued notice had been transferred and the new incumbent joined and decided the case on March 14, 1986, and imposed the penalty. An appeal was preferred against the penalty and the Commissioner of Wealth-tax (Appeals), though he confirmed the penalty, directed recomputation of the quantum after considering the Tribunal's order. The assessee filed an appeal before the Income-tax Appellate Tribunal, wherein the appeal has been allowed and penalty has been set aside. An application thereafter was moved by the petitioner for making a reference to this court which too was rejected. Hence, this application under Section 27(3) of the Wealth-tax Act has been filed. It is contended by the petitioner that due weight has not been given to the case-law cited before the Income-tax Appellate Tribunal wherein it had been held that, even after irregularities are left out, there is no ground for setting aside the order in appeal by the Tribunal. Learned counsel for the petitioner has cited before us the case of Prabhudayal Amichand v. CIt [1989] 180 ItR 84 (MP) and CIt v. Jaswantiraj and Bros. [1990] 182 ItR 151 (Cal). In both these cases, it had been held that the procedural irregularities not involving the question of jurisdiction can be cured. The question in the present case is not one about procedural irregularities. The Tribunal had held on facts that no notice of hearing was given before the order dated March 14, 1986, was passed by the successor assessing authority. Thus, the assessee had not been provided with an opportunity to argue his case regarding imposition of penalty. An assessee has a right to argue his case by himself or by his authorised representative before the concerned authority who is obliged to issue notice about the date of hearing. Keeping in view the principles of natural justice, much less when the penalty sought to be imposed which has the penal consequence and first principle of natural justice being audi alteram partem (sic). In the facts and circumstances of the case, it is true that the show-cause notice had been given earlier to the assessee-respondent who had filed the reply but had prayed for calling for the record from the Tribunal in the main proceedings. It is thereafter that the officer changed and the succeeding officer did not think it proper to issue a fresh notice. May be, in the circumstances, that if the date would have been fixed earlier, no fresh notice was necessary but there is no indication available from the record and it is a question of fact that sufficient opportunity was granted to the respondent for hearing or not. We are not inclined to hold an enquiry into that aspect. Suffice it to say that no substantial question of law is involved so as to call for a reference and the application is rejected.;