YOGENDRA CHANDRA VS COMMISSIONER OF WEALTH-TAX, 1992 PTD-HIMACHAL-PRADESH-HIGH-COURT-INDIA 814 (1990)

1992 P T D 814

[Himachal Pradesh High Court (India)]

[187 I T R 58]

Before V.K Mehrotra and D.P. Sood, JJ

YOGENDRA CHANDRA

Versus

COMMISSIONER OF WEALTH-TAX and others

Civil Writ Petition No.54 of 1989, decided on 13/07/1990.

(a) Wealth-tax-

----Penalty---Failure to furnish returns on time---Waiver or reduction of penalty---Scope of power under subsection (4) of S.18B, Indian Wealth Tax Act, 1957---Relief can be granted under subsection (4) of S.18B even where assessee had applied under subsection (1) of S.18B.

Under subsection (1) of section 18B of the Indian Wealth-tax Act, 1957, the power conferred upon the Commissioner is to reduce or waive the amount of penalty under certain circumstances. The power conferred upon the Commissioner under subsection (4) of section 18B is not confined only to reduction or waiver of the amount of penalty payable by the assessee but extends also to stay or to compound any proceeding for the recovery of any such amount after recording reasons there for, if he is satisfied that to do otherwise would cause genuine hardship to the assessee, having regard to the circumstances of the case, provided the assessee has co-operated in the enquiry relating to the assessment or in any proceeding for the recovery of any amount due from him. Quite clearly, the scope of the power conferred under subsection (4) is wider than that conferred by subsection (1) of section 18B, provided the circumstances contemplated by subsection (4) for grant of relief exist to the satisfaction of the Commissioner. The power under subsection (4), on the language used therein, can be exercised even at the stage when the amount of penalty imposed upon the assessee is in the process of being recovered. Subsection (4) of section 18B begins by saying that the Commissioner may, "without prejudice to the powers conferred on him by any other provision of this Act", reduce or waive the amount of any penalty or stay or compound any proceeding for the recovery thereof in case he was satisfied about the fact of the assessee having co-operated in the proceeding and the result of recovery against him causing genuine hardship to him. The further discretion contemplated under subsection (4) is to be in addition to and not in substitution of the power contemplated in the matter for the Commissioner under subsection (1). If the contents of the power under both the subsections were to be treated as in substitution of each other, the enactment of one of the two subsections would amount to an exercise in redundancy. Such action on the part of Parliament cannot be visualised. It has, of necessity, to be said that, after having empowered the Commissioner to reduce or waive the amount of penalty in certain circumstances under subsection (1), further power was contemplated to be conferred upon the Commissioner, independently of the power conferred under subsection (1), of granting relief in appropriate cases if the conditions mentioned in subsection (4) were found to exist to his satisfaction. The circular of the Central Board of Direct Taxes (see (1976) 120 ITR (St. 9) also shows that the intention of the enactment of subsection (4) both in section 18B of the Wealth-tax Act and section 273A of the Income-tax Act, 1961, was to enlarge the powers of the Commissioner in the matter of grant of relief to an assessee regarding the amount of penalty. It is clear that subsection (4) confers upon the Commissioner the power of considering the request of an assessee for relief even in a case where the assessee has earlier approached him under subsection (1).

Held accordingly, that, irrespective of a decision upon the request made earlier by the petitioner under section 1813(1) of the Wealth-tax Act which was partly accepted by the Commissioner, the petitioner was entitled to seek fresh relief under section 1813(4).

Attorney-General v. Carlton Bank (1899) 2 OB 158; CIT v. Gotla (J.H.) (1985) 156 ITR 323 (SC); CIT v. National Taj Traders (1980) 121 ITR 535 (SC); CIT v. Simpson and Co. (1980) 122 ITR 283 (Mad.); Desh Bandhu Gupta and Co. v. Delhi Stock Exchange Association Ltd. (1980) 50 Comp Cas 84; (1979) AIR 1979 SC 1049; Keshavji Ravji and Co. v. C.I.T. (1990) 183 ITR 1 (SC); Nazir Ahmad v. King Emperor (1936) AIR 1936 PC 253; Padmavati Jaykrishna Trust v. CWT (1966) 61 ITR 66 (Guj.); Parbhani Transport Co operative Society Ltd. v. Regional Transport Authority (1960) AIR 1960 SC 801; Shital Prasad v. C.I.T. (1986) 161 ITR 259 (All.); Varghese (K.P.) v. ITO (1981) 131 ITR 597 (SC) ref.

(b) Interpretation of statutes---

---- Construction beneficial to assessee---Circulars of Central Board of Revenue can be used as an aid to interpretation.

A construction which is beneficial to the assessee and which would effectuate the purpose for which the provision was enacted should be adopted. The circulars issued by the Central Board of Direct Taxes can be utilised to understand the scope of the provision to which they relate.

Mrs. Shyam Dogra for the Petitioner.

Indar Singh for the Respondents.

JUDGMENT

V.K. MEHROTRA, J.---The petitioner, Shri Yogendra Chandra, filed returns under the Wealth-tax Act, 1957 (for brief, "the Act"), for the years 1970-71 to 1975-76 on January 21, 1976, before the Wealth-tax Officer, A Ward, Shimla. His case is that the returns could not be filed within the prescribed period for various reasons. His father, late Raja Rana Digvijay Chand of Jubbal, died and it took some time before he could get the succession certificate in respect of the property of his father; a fire accident destroyed the palace at Jubbal and two other buildings in the year 1969; the petitioner's wife was ailing necessitating her treatment at Delhi in the year 1972; the previous tax counsel who was looking after these matters withdrew and counsel engaged later took a long time in getting the material collected, etc.

The Wealth-tax Officer imposed penalties for late filing of returns for each of these years by order, dated March 25, 1980. According to the petitioner, due regard was not given to the facts pointed out on behalf of the petitioner. Later, the petitioner made an application under section 1813 of the Act for relief in respect of the penalties not only for the aforesaid years but also for earlier years 1967-68 to 1969-70. The Commissioner of Wealth-tax Patiala, passed an order on January 14, 1986, on this application. In it, the Commissioner said that:

"On a consideration of the circumstances of the case, the inheritance by the assessee, his background and the fact that, except for the assessment years 1970-71 and 1971-72, no notices were served on the assessee, I consider that the assessee is entitled to relief under section 1813 of the Wealth-tax Act for the other years. However, in view of the circumstances and specially the fact that initially the assessee failed to make ...I hold that he is not entitled to full waiver of the penalty levied on him. The penalty levied will be reduced to 1% of the amount levied/leviable..."

The result of this order was that there was no relief granted to the petitioner in respect of the penalty imposed for late filing of the returns for the assessment years 1970-71 and 1971-72. The amount of penalty for these years, as imposed by the Wealth-tax Officer on March 25, 1980, was Rs.2,39,223 and Rs.90,652, respectively.

The petitioner, Yogendra Chandra, then made another application dated August 4. 1986, to the Commissioner of Wealth-tax, Patiala, describing it as a petition under section 1813(4) of the Act. Amongst other things, he mentioned in it that the amount of penalty is too large and that he had no money to discharge the colossal liability; that his financial position was very precarious and the recovery of such huge amount would cause genuine hardship to him and further that he had always co-operated with the Department in every enquiry relating to assessments and all proceedings for recovery. The prayer in the petition was that the amount of penalty for these two years may be waived. The Commissioner disposed of the petition by his order, dated August 5, 1988. The Commissioner was of the opinion that, inasmuch as relief had already been given in respect of the amount of penalty relating to some assessment years, there could be no further consideration of the petitioner's case under section 1813(4) in view of the provisions of section 18B(3) of the Act. It is thereafter that the petitioner approached this Court through the present writ petition under Article 226 of the Constitution.

Section 18B was inserted in the Act by the Taxation Laws (Amendment) Act, 1975, with effect from October 1, 1975. After some later amendments, it reads thus:

"18B.--(1) Notwithstanding anything contained in this Act, the Chief Commissioner or Commissioner may, in his discretion, whether on his own motion or otherwise,---

(i) reduce or waive the amount of penalty imposed or imposable on a person under clause (i) of subsection (1) of section 18 for failure without reasonable cause to furnish the return of net wealth which such person was required to furnish under subsection (1) of section 14, or

(ii) reduce or waive the amount of 'penalty imposed or imposable on a person under clause (iii) of subsection (1) of section 18, if he is satisfied that such person,---

(a) in the case referred to in clause (i), has, prior to the issue of a notice to him under subsection (2) of section 14, voluntarily and in good faith made full and true disclosure of his net wealth, and

(b) in the case referred to in clause (ii), has, prior to the detection by the Assessing Officer, of the concealment of particulars of assets or of the inaccuracy of particulars furnished in respect of any asset or debt in respect of which the penalty is imposable, voluntarily and in good faith made full and true disclosure of such particulars,

and also has co-operated in any inquiry relating to the assessment of his net wealth and has either paid or made satisfactory arrangements for the payment of any tax or interest payable in consequence of an order passed under this Act in respect of the relevant assessment year.

Explanation.---For the purposes of this subsection, a person shall be deemed to have made full and true disclosure of the particulars of his assets or debts in any case where the excess of net wealth assessed over the net wealth returned is of such a nature as not to attract the provisions of clause (c) of subsection (1) of section 18.

(2) Notwithstanding anything contained in subsection (1), if in a case falling under clause (c) of subsection (1) of section 18, the net wealth in respect of which the penalty is imposed or imposable for the relevant assessment year, or, where such disclosure relates to more than one assessment year, the net wealth for any one of the relevant assessment years, exceeds five hundred thousand rupees, no order reducing or waiving the penalty under subsection (1) shall be made by the Chief Commissioner or Commissioner, except with the previous approval of the Board.

(3) Where an order has been made under subsection (1) in favour of any person, whether such order relates to one or more assessment years, he shall not be entitled to any relief under this section in relation to any other assessment year at any time after the making of such order.

(4) Without prejudice to the powers conferred on him by any other provision of this Act, the Chief Commissioner or Commissioner may, on an application made in this behalf by an assessee and after recording his reasons for so doing, reduce or, waive the amount of any penalty payable by the assessee under this Act or stay or compound any proceeding for the recovery of any such amount, if he is satisfied that,--

(i) to do otherwise would cause genuine hardship to the assessee, having regard to the circumstances of the case, and

(ii) the assessee has co-operated in any inquiry relating to the assessment or any proceeding for the recovery of any amount due from him.

(5) Every order made under this section shall be final and shall not be called into question by any Court or any other authority."

Subsection (1) of section 18B permits the Chief Commissioner or Commissioner to reduce or waive the amount of penalty imposed or imposable on a person under the circumstances enumerated therein subsection (2) says that in case the net wealth exceeds the amount mentioned therein, the order of reduction or waiver of the amount of penalty shall be made with the previous approval of the Board which is the Board of Direct Taxes. Subsection (3) precludes a person who has obtained relief under this section in relation to any assessment year from obtaining relief in relation to any other year, after the earlier order is made.

What is noticeable is that, under subsection (1), the power conferred upon the Commissioner is to reduce or waive the amount of penalty under certain circumstances. When one looks at subsection (4), one finds that the power which is conferred upon the Chief Commissioner or the Commissioner therein is not confined only to reduction or waiver of the amount of penalty payable by the assessee but extends also to stay or to compound any proceeding for the recovery of any such amount after recording reasons there for, if he is satisfied that to do otherwise would cause genuine hardship to the assessee, having regard to the circumstances of the case, provided the assessee has co-operated in the enquiry relating to the assessment or in any proceeding for the recovery of any amount due from him. Quite clearly, the scope of the power conferred under subsection (4) is wider than that conferred by subsection (1) of section 18B, provided the circumstances contemplated by subsection (4) for grant of relief exist to the satisfaction of the Commissioner. The power under subsection (4), on the language used therein, can be exercised even at the stage when the amount of penalty imposed upon the assessee is in the process of being recovered.

After the passing of the Taxation Laws (Amendment) Act, 1975, Circular No.179, dated 30th September, 1975, was issued by the Director, Central Board of Direct Taxes. It is printed in (1976) 102 ITR (St.) from pages 9 to 32. It describes the subject of the circular to be explanatory notes on the provisions coming into force with effect from October 1, 1975. In paragraph 48, while dealing with the amendments to the Wealth Tax Act, it mentions that the Amending Act has made several amendments to the Wealth-tax Act, 1957, in order to bring its provisions relating to jurisdiction matters, searches and seizures, prosecutions, etc., broadly in line with the corresponding provisions in the Income-tax Act as they have emerged after their amendment by the Amending Act. In the tabular chart in that paragraph, it has mentioned both section 18B of the Wealth Tax Act as well as section 273A of the Income Tax Act as new provisions corresponding to each other.

While dealing with section 273A of the Income-tax Act, as introduced by the same Amending Act, a mention has been made about the power of the Commissioner under the new section 273A of the Income Tax Act in paragraphs 31 and 32 of the circular. Before referring to the contents of these paragraphs, it would be useful to read section 273A, as introduced in the Income Tax Act, 1961, by the same Amending Act as it stands at present:

"273A. Power to reduce or waive penalty. etc., in certain cases.---(1) Notwithstanding anything contained in this Act, the Commissioner may, in his discretion, whether on his own motion or .otherwise; --

(i) reduce or waive the amount of penalty imposed or imposable on a person under clause (i) of subsection (1) of section 271 for failure, without reasonable cause, to furnish the return of total income which he was required to furnish under subsection (1) of section 139; or

(ii) redue or waive the amount of penalty imposed or imposable on a person under clause (iii) of subsection (1) of section 271; or

(iii) reduce or waive the amount of interest paid or payable under subsection (8) of section 139 or section 215 or section 217 or the penalty imposed or imposable under section 273,

if he is satisfied that such person---

(a) in the case referred to in clause (i), has, prior to the issue of a notice to him under subsection (2) of section 139, voluntarily and in good faith made full and true disclosure of his income;

(b) in the case referred to in clause (ii), has, prior to the detection by the Income-tax Officer, of the concealment of particulars of income or of the inaccuracy of particulars furnished in respect of such income, voluntarily and in good faith, made full and true disclosure of such particulars;

(c) in the cases referred to in clause (iii), has, prior to the issue of a notice to him under subsection (2) of section 139, or where no such notice has been issued and the priod for the issue of such notice has expired, prior to the issue of notice to him under section 148, voluntarily and in good faith made full and true disclosure of his income and has paid the tax on the income so disclosed,

and also has, in all the cases referred to in cla-1ses (a), (b) and (c), co- operated in any enquiry relating to the assessment of his income and has, either paid or made satisfactory arrangements for the payment of any tax or interest payable in consequence of an order passed under this Act in respect of the relevant assessment year.

Explanation 1.---For the purposes of this subsection, a person shall be deemed to have made full and true disclosure of his income or of the particulars relating thereto in any case where the excess of income assessed over the income returned is of such a nature as not to attract the provisions of clause (c) of subsection (1) of section 271.

Explanation 2.---Where any books of account, other documents, money, bullion, jewellery or other valuable article or thing belonging to a person are seized under section 132 and within fifteen days of such seizure, the person makes a full and true disclosure of his income to the Commissioner, such person shall, for the purposes of clause (b) of this subsection, be deemed to have made, prior to the detection by the Income-tax Officer of the concealment of particulars of income or of the inaccuracy of particulars furnished in respect of such income, voluntarily and in good faith, a disclosure of such particulars.

(2) Notwithstanding anything contained in subsection (1),---

(a) if in a case the penalty imposed or imposable under clause (i) of subsection (1) of section 271 or the minimum penalty imposable under section 273 for the relevant assessment year, or, where such disclosure relates to more than one assessment year, the aggregate of the penalty imposed or imposable under the said clause or of the minimum penalty imposable under the said section for those years, exceeds a sum of one hundred thousand rupees, or

(b) if in a case falling under clause (c) of subsection (1) of section 271, the amount of income in respect of which the penalty is imposed or imposable for the relevant assessment year, or, where such disclosure relates to more than one assessment year, the aggregate amount of such income for those years, exceeds a sum of five hundred thousand rupees,

no order reducing or waiving the penalty under subsection (1) shall be made by the Commissioner except with the previous approval of the Board.

(3) Where an order has been made under subsection (1) in favour of any person, whether such order relates to one or more assessment years, he shall not be entitled to any relief under this section in relation to any other assessment year at any time after the making of such order.

(4) Without prejudice to the powers conferred on him by any other provision of this Act, the Commissioner may, on an application made in this behalf by an assessee, and after recording his reasons for so doing, reduce or waive the amount of any penalty payable by the assessee under this Act or stay or compound any proceeding for the recovery of any such amount, if he is satisfied that---

(i) to do otherwise would cause genuine hardship to the assessee, having regard to the circumstances of the case; and

(ii) the assessee has co-operated in any enquiry relating to the assessment or any proceeding for the recovery of any amount due from him:

Provided that where an amount of any penalty payable under this Act or, where such application relates to more than one penalty, the aggregate amount of such penalties exceeds one hundred thousand rupees, no order reducing or waiving the amount or compounding any proceeding for its recovery under this subsection shall be made by the Commissioner except with the previous approval of the Board.

(5) Every order made under this section shall be final and shall not be called into question by any Court or any other authority."

The language in which subsection (3) and subsection (4) of section 273A are couched is identical with the language of section 18B(3) and (4), except the proviso which is found in subsection (4) of section 273A.

In the relevant part, paragraphs 31 and 32 of the circular says that (see (1976) 102 ITR (St.) 22 and 23):

"31. The Amending Act has deleted the existing subsections (4A) and (4B) of section 271 of the Income-tax Act relating to powers of the Commissioner to reduce or waive penalty in certain cases and re-enacted these provisions, with several modifications, in new section 273A. The main points of difference between the existing provisions in section 271(4A) and (4B) on the one hand and new section 273A on the other are as follows: ....

(iii) 1t has been clarified that the Commissioner will have the power to reduce or waive the penalty or interest even after such penalty or interest has been imposed or levied. Further, the Commissioner will be able to exercise the power under section 273A either on an application made by the assessee or on his own motion...

(vi) A new provision has also been made in subsection (4) of new section 273A to the effect that the Commissioner may, on an application being made by the assessee and after recording his reasons, reduce or waive any penalty payable by an assessee under the Income Tax Act, or stay or compound any proceeding for the recovery of such penalty in cases of genuine hardship if he is satisfied that the assessee has co-operated in any enquiry relating to the assessment or any proceeding for the recovery of any amount due from him.

32. The provisions of section 273A relating to reduction or waiver of penalty or interest otherwise than in cases of genuine hardship referred to in subsection (4), will apply in relation to cases where the application for reduction or waiver of penalty or interest is made by the assessee on or after October 1, 1975, or where the Commissioner of Income Tax decides to consider the case on his own motion on or after that date. The power under subsection (4) to reduce or waive penalty in cases of genuine hardship or to compound any proceeding relating to recovery of penalty will be available to the Commissioner in respect of penalties that have already been imposed before 1st October 1975, as also those that may be imposed thereafter."

The contents of section 273A of the Income Tax Act, as the provision stands today, clearly evince an intention on the part of Parliament to enlarge the power of the Commissioner to grant relief in the matter of penalty which may have been imposed upon an assesse. Unlike subsections (4A) and (4B) of j section 271 of the Income-tax Act, the Commissioner has now been empowered also to grant relief at a stage when the amount of penalty is being realised from the assessee, either by further reducing or waiving it or, by staying the proceedings for the recovery of the amount and compounding the proceedings for recovery of the amount of penalty in case the assessee is found to have co-operated in the proceedings and it is felt by the Commissioner that continuing with realisation of the amount of penalty from him would result in great hardship to the assessee. The intention of Parliament in enacting subsection (4) was clear. It wanted to vest the Commissioner with greater discretion in extending relief to an assessee who was found to have co-operated in the enquiry relating to assessment or proceedings for recovery of the amount due from him but who was likely to face genuine hardship in case the amount was sought to be recovered from him further. What is clear, therefore, from the language in which subsection (1) and subsection (4) of section 273A of the Income Tax Act or section 18B(1) and section 18B(4) of the Wealth Tax Act are couched is that the further discretion contemplated under subsection (4) was to be in addition to and not in substitution of the power contemplated in the matter for the Commissioner under subsection (1). If the contents of the power under both the subsections were to be treated as in substitution of each other, the enactment of one of the two subsections would amount to an exercise in redundancy. Such action on the part of Parliament cannot be visualised. It has, of necessity, to be said that after having empowered the Commissioner to reduce or waive the amount of penalty in certain circumstances under subsection (1), further power was contemplated to be conferred upon the Commissioner, independently of the power conferred under subsection (1), of granting relief in appropriate cases if the conditions mentioned in subsection (4) were found to exist to his satisfaction.

Thus read, the restriction mentioned in subsection (3) of section 18B, which is in pari materia with section 273A(3) of the income-tax Act, 1961, is to be confined to the exercise of powers by the Commissioner under subsection (1) alone. Subsection (4) of section 18B begins by saying that the Commissioner may "without prejudice to the powers conferred on him by any other provision of this Act", reduce or waive the amount of any penalty or stay or compound any proceeding for the recovery thereof in case he was satisfied about the fact of the assessee having co-operated in the proceeding and the result of recovery against him causing genuine hardship to him. In the view that we have taken of the scheme of section 18B of the Act it will have to be held, as we do, that the words "any other provisions of this Act" used in the opening part of subsection (4) would also take within their sweep the provision contained in subsection (3). The stand on behalf of the Revenue, that the words used in subsection (3) made it clear that in case relief had been granted under subsection (1), an assessee would not be entitled to any further relief under the section evinced the intention of the Legislature to confine the grant of relief under section 18B 8 to an assessee to only one occasion, may appear plausible if subsection (3) is to be read literally without regard to the scheme of the entire section 18B. But that interpretation would render the provisions of subsection (4) redundant. Such redundancy is not countenanced by law. More so, as in the case of similar provisions of section 273A of the Income-tax Act, the Legislature designedly extended the scope of power of the Commissioner for grant of relief from that which he possessed under section 271(4A) and (4B) earlier.

The circular of the Central Board of Direct Taxes, noticed earlier, also shows that the intention of the enactment of subsection (4) of section 18B of the Act and section 273A of the Income-tax Act was to enlarge the powers of the Commissioner in the matter of grant of relief to an assessee regarding the amount of penalty. This is how the Department understood the contents of these provisions. Their understanding was clearly consistent with the avowed object with which greater powers for grant of relief in the matter of penalty were being conferred on the Commissioner by these provisions, particularly those contained in subsection (4). The interpretation of the Central Board of Direct Taxes can be considered only as an aid to understanding the intention of Parliament in enacting, in particular, subsection (4). Such an interpretation is permissible, as is clear from the decision of the Supreme Court in Desh Bandhu Gupta and Co. v. Delhi Stock Exchange Association Ltd. (1980) 50 Comp Cas 84; AIR 1979 SC 1049,whercin the Supreme Court took note of a press statement or press-note which had been issued by the Finance Ministry immediately upon the issue of the notification in question for coming to a conclusion as to the nature of contracts which were to be considered as being covered by the notification issued under the Securities Contracts (Regulation) Act, 1956. Also, from its decision in K.P. Varghese v. ITO (1981) 131 ITR 597 (SC), in which, after noticing with approval the decision in Desh Bandhu Gupta (1980) 50 Comp Cas 84 (SC), the Court said that the circulars issued by the Central Board of Direct Taxes could be utilised to understand the scope of a provision to which they related.

In K.P. Varghese's case (1981) 131 ITR 597, 617, the Supreme Court also observed (in paragraph 17) that:

.... It is a well-settled rule of interpretation that the Court should as far as possible avoid that construction which attributes irrationality to the Legislature ...

If, as suggested on behalf of the Revenue, we were to take the view that subsection (3) precluded the Commissioner from looking at the request of an assessee for relief under subsection (4), after he had once been given relief under subsection (1), we would be attributing irrationality to the Legislature in conferring an additional power upon the Commissioner of which exercise was not intended in case the Commissioner had, on an earlier occasion, examin8d the matter under subsection (1) which gave him the limited jurisdiction.

Subsection (4) of section 18B, in our opinion, confers upon the Commissioner power of wider amplitude than that conferred by subsection (1). It would be difficult for us to accept the plea on behalf of the Revenue that both these powers were intended to be exercised only once, as an alternative to each other. We would not be inclined to overlook what the Supreme Court has said in Parbhani Transport Co-operative Society Ltd. v. Regional Transport Authority, AIR 1960 SC 801, 804 (in paragraph 8) by observing that:

" ...If a statute contains provisions giving more than one power, then the rule cannot be applied so as to take away the powers conferred by any one of these provisions ..."

The rule that was being invoked before the Supreme Court was the one enunciated by the Privy Council in Nazir Ahmad v. King Emperor, AIR 1936 PC 253, to the effect that (at p.804 of AIR 1960 SC):

" ....where a power is given to do a certain thing in a certain way, the thing must be done in that way or not at all."

The observation quoted earlier was made by a Constitution Bench while examining the question whether the power of the State Government was confined to the special provisions contained in Chapter IV of the Motor Vehicles Act, 1939, to run its buses or the Government could also resort to other provisions of tire Act for it.

If a literal interpretation of subsection (3) of section 18B, as suggested on behalf of the Revenue, is accepted, it would lead to a manifestly absurd result which could not have been intended by the Legislature. It. would make exercise of power under subsection (4) impossible and render it otiose in case an assessee had approached the Commissioner for relief under subsection (1) earlier. A prayer for reduction or waiver of the amount of penalty can be sought under subsection (1) where the amount of penalty may either have been imposed or may even be imposable. Under subsection (4), a prayer can be made for its reduction or waiver when the penalty has become payable or for its stay or compounding of the proceeding for the recovery of an amount of penalty already imposed is going on. If the rule contained in subsection (3) is held applicable even in respect of exercise of power under subsection (4), the result that would follow would clearly negate the existence of the power in the Commissioner to grant relief under the subsection after actual imposition of the penalty. This would defeat the object of the Legislature in enacting subsection (4). The literal interpretation suggested by the Revenue cannot, therefore, be given to these provisions. We find support for our view in the decision of the Supreme Court in CIT v. National Taj Traders (1980) 121 ITR 535, wherein the provisions of section 33-B, introduced in the Indian Income Tax Act, 1922, by the Income-tax and Business Profits Tax (Amendment) Act, 1948, conferring revisional powers upon the Commissioner to correct the erroneous orders of the Income-tax Officer in so far as they were prejudicial to the Revenue, came up for consideration. What was being canvassed on behalf of the Revenue in that case was that the period of two years during which revisional power could be exercised was applicable not only to suo motu orders of the Commissioner but also to orders passed by him in pursuance of a direction or order passed by the Appellate Tribunal under subsection (4) or by any other higher authority. The Court said that the literal construction suggested by the Revenue would lead to such manifestly anomalous results which, it thought, were not intended by the Legislature. Also, that the correct principle for interpretation was that the construction should be such as would not only effectuate the intention of the Legislature but also make each part of the provision workable. There is another way of looking at the problem. The provisions of section 18B, like those of section 273A of the Income Tax Act, 1961, were meant to afford relief to an assessee.

If, by the narrow construction suggested on behalf of the Revenue, the amplitude of the powers of the Commissioner is cut down, such. a construction is to be avoided. A construction which is beneficial to the assessee and which would effectuate the purpose for which the provision was enacted, should be adopted. To borrow the words of the Supreme Court in Keshavji Ravji and Co. v. CIT (1990) 183 ITR 1, 16 (SC):

" ....To say that a Court could not resort to the so-called `equitable construction' of a taxing statute is not to say that, where a strict literal construction leads to a result not intended to subserve the object of the legislation, another construction, permissible in the context, should not be adopted. In CIT v. J.H. Gotla (1985) 156 ITR 323 this Court said (at pages 339 340):

...We should find out the intention from the language used by the Legislature and if strict literal construction leads to an absurd result, i.e. a result not intended to be subserved by the object of the legislation found in the manner indicated before, then if another construction is possible apart from the strict literal construction, then that construction should be preferred to the strict literal construction. Though equity and taxation are often strangers, attempts should be made that these do not remain always so and if a construction results in equity rather than in injustice, then such construction should be preferred to the literal construction. Furthermore, in the instant case, we are dealing with an artificial liability created for counteracting the effect only of attempts by the assessee to reduce tax liability by transfer...."

In this respect, taxing statutes are not different from other statutes. In Attorney-General v. Carlton Bank (1899) 2 OB 158, Lord Russel of Killowen CJ. said (at p. 164):

"I see no reason why special canons of construction should be applied to any Act of Parliament, and I know of no authority for saying that a taxing Act is to be construed differently from any other Act. The duty of the Court is, in my opinion, in all cases the same, whether the Act to be construed relates to taxation or to any other subject, viz., to give effect to the intention of the Legislature ...."

Thus viewed, it is clear that subsection (4) confers upon the Commissioner the power of considering the request of an assessee for relief even in a case where the assessee has earlier approached him under subsection (1). The restriction contemplated by subsection (3) only applies to a further request for relief by the assessee under subsection (1). It does not affect his right to approach the Commissioner under subsection (4) of section 18B. It is trife, in respect of a provision for relief, like section 18B, that where two views are possible, the construction beneficial to the assessee should be adopted by the Court. If a precedent is needed, we may only refer to the decision of a Division Bench of the Madras High Court in CIT v. Simpson and Co. (1980) 122 ITR 283.

We also get assistance from the views expressed by a Division Bench of the Allahabad High Court in Shital Prasad v. CIT (1986)161 ITR 259, in the context of section 273A of the Income Tax Act, 1961.

It is permissible to take assistance from the interpretation put upon the provisions of section 273 of the Income-tax Act, 1961, for construing the scope of similar provisions under the Wealth Tax Act. (See Padmavati Jaykrishna Turst v. CWT (1966) 61 ITR 66 (Guj.). It was observed in that case by a Division Bench, speaking through shelat CJ. at page 77 while considering the provisions of section 21 of the Wealth Tax Act, that:

"...In construing section 21, it is also permissible to derive some assistance from section 41(1) of the Indian Income Tax Act, 1922, and the first proviso thereof, where the Legislature has not only used the same words as in subsections (1) and (4) of section 21 but has also made a similar distinction between a case where the shares of the persons on whose behalf the income is held by a trustee are determinate and where they are not..."

We are clearly of the opinion, in view of what we have said earlier, that irrespective of a decision upon the request made earlier by the petitioner under section 1813(1), which was partly accepted by the Commissioner, the petitioner is entitled to seek relief afresh under section 18(4) and the provisions of subsection (3) do not preclude the Commissioner, as was felt by him, from entertaining and considering the prayer for relief made by the petitioner under subsection (4) of section 18B on its merits afresh.

The petition is allowed and the order of the Commissioner, dated August 5, 1988 (Annexure PF), is quashed. We direct the Commissioner to consider the petition made by the petitioner under section 18B(4) on its merits.

Costs on parties.

M.B.A./1532/T Petition allowed.