Penalties under Wealth-tax Act upheld for multiple years except 1973-74; studying abroad not a reasonable cause.

The court upheld the penalties imposed under the Wealth-tax Act for six assessment years, except for 1973-74, citing lack of reasonable cause for delayed filing of returns. It rejected the argument that studying abroad constituted reasonable cause. The court ruled that notices by the Wealth-tax Officer did not need to specify commencement and termination of defaults for penalty proceedings. The decision favored the Revenue, directing each party to bear their own costs.

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Issues:
Penalty levied under section 18(1) of the Wealth-tax Act for six assessment years from 1967-68 to 1972-73.

Analysis:
The judgment pertains to references made under section 27(1) of the Wealth-tax Act, 1957, regarding the penalty levied under section 18(1) of the Act for six assessment years. The Tribunal upheld the penalties for most years except for 1973-74. The case involved an oral gift of properties by the assessee's father, non-filing of returns within stipulated time, and subsequent penalty proceedings initiated by the Wealth-tax Officer. The Appellate Assistant Commissioner and the Tribunal had previously dismissed the appeals challenging the penalties.

The Tribunal found that the assessee had not shown reasonable cause for the delay in filing returns for the relevant years, except for 1973-74. The Tribunal's finding on this factual aspect was considered final. The assessee's argument that residing outside India as a student constituted reasonable cause was rejected by the court. The Tribunal's decision on this matter was upheld.

The assessee contended that the notices issued by the Wealth-tax Officer were vague and did not specify the commencement and termination of defaults, citing a ruling of the Gauhati High Court. However, the court found that the Gauhati High Court ruling was no longer valid in light of a Supreme Court ruling and legislative provisions. The court held that specifying the commencement and termination of default in notices was not an absolute requirement for initiating penalty proceedings.

Ultimately, the court answered the question in favor of the Revenue and against the assessee, upholding the penalties imposed under the Wealth-tax Act for the relevant assessment years. The court directed the parties to bear their own costs in the circumstances of the cases.

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