1983 (4) TMI 21 - HC - Wealth-tax

High Court Quashes Commissioner's Order Penalizing Late Tax Filing

The High Court quashed the Commissioner's order penalizing the petitioner for late filing of wealth tax returns and directed a re-examination in ... Application under s.18B for waiver of penalty - Maintainability of waiver application despite delayed return - Judicial discretion of Commissioner in waiver applications - Remand for fresh consideration and disposal in accordance with lawApplication under s.18B for waiver of penalty - Maintainability of waiver application despite delayed return - An application under section 18B for waiver or reduction of penalty is maintainable notwithstanding that the return was filed after the time prescribed by the Act; delay in filing the return is not a bar to the Commissioner considering the application on its merits. - HELD THAT: - The court held that s.18B does not place an embargo on the Commissioner from considering an application for waiver or reduction of penalty merely because the assessee filed the return late. An application under s.18B is maintainable even if there was delay in filing the returns and such delay cannot, by itself, be treated as a ground for refusing to consider the application on merits. The impugned order was recorded solely on the basis of the existence of delay, which the court found to be legally impermissible as a reason to decline consideration of the application.Application under s.18B must be considered on merits despite delayed return; delay alone is not a ground to refuse consideration.Judicial discretion of Commissioner in waiver applications - Remand for fresh consideration and disposal in accordance with law - Whether the Commissioner properly exercised the judicial discretion vested in him in disposing of the petitioner's s.18B application; and the appropriate remedy where the Commissioner fails to consider relevant matters and disposes the application on irrelevant grounds. - HELD THAT: - The Commissioner's brief order rejected the petitioner's application solely because of delay in filing returns. The court found that by taking an irrelevant consideration as the sole basis for rejection and failing to exercise the statutory judicial discretion vested in him under s.18B, the Commissioner did not decide the matter in conformity with law. Given this failure, the appropriate remedy is to quash the impugned order and direct the Commissioner to restore the application to file and re-examine and dispose of it in accordance with law and the observations of the court.Impugned order quashed; matter remanded to the Commissioner for fresh consideration and lawful disposal of the s.18B application.Final Conclusion: The Court quashed the Commissioner's order rejecting the s.18B waiver application (which had been disposed of solely on the ground of delayed returns), directed restoration of the application and remand for reconsideration and disposal in accordance with law and the observations in the judgment, and ordered each party to bear its own costs. The petitioner, an assessee under the Wealth Tax Act, filed returns late and was penalized. The Commissioner rejected her application for penalty waiver without proper consideration. The High Court quashed the Commissioner's order and directed a re-examination in accordance with the law. The parties were directed to bear their own costs. (1983 (4) TMI 21 - KARNATAKA High Court)