Penalty jurisdiction under the amended Wealth-tax Act could not remain with the Inspecting Assistant Commissioner once authority shifted to the Wealth-tax Officer.

After the amendment of section 18 of the Wealth-tax Act from 1 April 1976, jurisdiction to impose penalty vested in the Wealth-tax Officer alone. Because jurisdiction is procedural and must be tested by the law in force when power is exercised, a pending reference to the Inspecting Assistant Commissioner did not preserve his authority after the amendment withdrew it. The penalty order passed by the Inspecting Assistant Commissioner was therefore without jurisdiction and was cancelled.

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Issues: Whether, after the amendment of section 18 of the Wealth-tax Act with effect from 1 April 1976, the Inspecting Assistant Commissioner retained jurisdiction to impose penalty in a pending matter referred to him before the amendment.

Analysis: The amended scheme vested power to impose penalty under section 18 in the Wealth-tax Officer alone from the date the amendment came into force. Jurisdiction being procedural, it had to be tested by the law prevailing on the date of exercise of power. A pending reference before the Inspecting Assistant Commissioner did not preserve his authority once the amendment withdrew that jurisdiction.

Conclusion: The penalty order passed by the Inspecting Assistant Commissioner was without jurisdiction and could not be sustained; the penalty was cancelled.

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