Reasonable cause for delayed wealth-tax return filing accepted where partnership capital accounts were not finalised

Delay in filing the wealth-tax return was treated as supported by reasonable cause where the assessee's main wealth was capital in partnership firms and the firms' accounts had not been finalised by the due date, leaving the capital position unascertainable. The absence of a formal petition did not undermine the explanation already appearing on the record. On these facts, penalty under section 18(1)(a) of the Wealth-tax Act was held not sustainable, and cancellation of the penalty was upheld.

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Issues: Whether penalty under section 18(1)(a) of the Wealth-tax Act was exigible for delay in filing the wealth-tax return where the assessee's capital position in partnership firms was not ascertainable when the return became due.

Analysis: The delay was found to have arisen because the assessee's major wealth consisted of capital in two firms and the firms' accounts had not been finalised by the due date, so the capital account position could not be ascertained for filing the return. On these facts, the delay was treated as properly explained by reasonable cause. The absence of a formal petition did not detract from the explanation accepted on the record.

Conclusion: The penalty was not sustainable and its cancellation was upheld.

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