TaxTMI 
TaxTMI 
2001 (2) TMI 264
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....table in nature and cannot be levied under section 35 of the Act. 3. Without prejudice to the above, the authorities below have erred in law in levying interest under section 17B in respect of an assessment processed by the issue of notice under section 17 of the Act and therefore, no interest under section 17B can be levied since the assessment has not been completed under section 16(5) and further that the return which was filed is non est in law which was regularized by notice under section 17 of the Act and there was no delay in filing the return in response to notice under section 17 of the Act. 4. Without prejudice to the above since the return is filed in response to notice under section 17 of the Act. Under section 17B of the Act as this section does not make reference to the delay in filing the return of wealth in response to notice under section 17 of the Act and only makes reference to section 14(1), 15 or in response to notice under section 16(4) of the Act. 5. For the above and other grounds that may be urged at the time of hearing of the appeal, your appellant humbly prays that the appeal may be allowed and the Hon'ble Tribunal may be pleased to grant refund ....
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....der section 17B. The details of the net wealth assessed, tax thereon, prepaid taxes, interest levied under section 17B, are as under: ------------------------------------------------------------------------------------------------- Net wealth Tax thereon Pre-paid Interest Total as per asst. taxes u/s 17B payable by the order dated &nb....
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....p; Nil 81,472 208,744 M.R.Seetharam (HUF) 5,161,029 138,330 Nil 88,512 226,842 M.R.Kodandararn (HUF) 6,477,955 103,310 Nil 66,112 169,422 M.R.Sampangiramiah (HUF) 4,637,549 122,625 Nil 78,464 201,089 M.R.Janakiram (HUF) 40,611,160 108,336 Nil 67,392 172,728 M.R.Raghuram (HUF) &....
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....given serious thought and careful consideration to the rival submissions with respect to the legal provisions. The question involves interpretation of section 17B of the WT Act, 1957 which is entitled "Interest for defaults in furnishing return of net wealth'. The relevant provisions of this section read as under: "Sec. 17B. (1) Where the return of net wealth for any assessment year under sub-section (1) of section 14 or section 15, or in response to a notice under clause (I) of sub-section (4) of section 16, is furnished after the due date, or is not furnished, the assessee shall be liable to pay simple interest at the rate of two per cent for every month or part of a month comprised in the period commencing on the date immediately following the due date, and,-- (a) where the return is furnished after the due date, ending on the date of furnishing of the return, or (b) where no return has been furnished, ending on the date of completion of the assessment under sub-section (5) of section 16, on the amount of tax payable on the net wealth as determined under sub-section (1) of section 16 or on regular assessment. Explanation 1: In this section, "due date' means the date ....
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....y be, the interest shall be increased or reduced accordingly, and,-- (i) in a case where the interest is increased, the Assessing Officer shall serve on the assessee a notice of demand in the prescribed form specifying the sum payable, and such notice of demand shall be deemed to be a notice under section 30 and the provisions of this Act shall apply accordingly, and (ii) in a case where the interest is reduced, the excess interest paid, if any, shall be refunded. (5) The provision of this section shall apply in respect of assessments for the assessment year commencing on the 1st day of April, 1989 and subsequent assessment years. 9. From the above, it is clear that interest under section 17B is attracted in a case where the return of net wealth is furnished after the due date or where no such return is filed before the completion of the assessment. In the present case, the assessees did file the return of net wealth on 15-2-1994 as against the due date of 30th June, 1991. Thus, apparently, there is a delay in filing the returns. The argument of the learned counsel for the assessee that since the returns were considered non est in law, they do not come within the purvie....
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.... time, they are regular assessments made under the Act. Therefore, we have to proceed to the assumption that a regular assessment has been completed under the Act and all natural consequences of such assessment will have to follow under the different sections of the Act. No doubt, assessment implies not only the determination of net wealth liable to be taxed under the Act, but also the wealth-tax payable by the assessee on the net wealth assessed including liability to interest under section 17B, if chargeable. The intention of the Legislature in enacting the provisions of section 17B is crystal clear. It is to levy interest which is compensatory in nature for withholding the revenue due to the Government on account of delay in filing the return of net wealth. In the present case, such a delay has occurred on the part of the assessees in not filing the returns of net wealth on or before the due date, i.e., 30th June, 1991. The assessees chose to do so only on 15-21994. The returns disclosed substantial net wealth assessable to tax. Consequently, there is a delay in the filing of the return during the period between the aforesaid dates. Hence, interest is clearly chargeable under se....