Wealth tax---

---- Recovery of tax--Delay in payment of tax---Interest---Waiver of interest---Law applicable---Subsection (2A) of S. 31 inserted w. e. f. 1-10-1.984, docs not have retrospective effect---Conditions laid down in subsection (2A) of S.31 not fulfilled---Interest could not be waived---Indian Wealth Tax Act, 1957, S. 31.

Subsection (2A) of section 31 of the Wealth Tax Act, 1957, does not have retrospective effect. The Legislature has made its intention clear by giving the specific date from which this amendment will come into force, i.e., with effect from October 1,1984.

Saurashtra Agencies (P.) Ltd. v. Union of India (1990) 186 ITR 634 (Cal.) fol.

Held, that, in the instant case, it was not proper to direct the Commissioner to waive the interest not only on the ground that the amendment inserting subsection (2A) of section 31 did not have retrospective effect but also on the ground that the assessee had not proved that it had fulfilled all the three conditions laid down in subsection (2A) section 31.

JUDGMENT

By this petition, the petitioner has prayed that the respondents be directed to quash the interest levied for delayed payment of tax.

The petitioner is a religious charitable trust crest by the late Banku Behari Shaw in the year 1925. By an application, Annexure A, the petitioner prayed for waiver of interest levied under section 31(2) of the Wealth Tax Act, 1957. The prayer of the petitioner was rejected by the Commissioner vide impugned order, Annexure F on the ground that the insertion of subsection (2A) has no retrospective effect in view of the decision reported in the case of Saurashtra Agencies (Pvt.) Ltd. v. Union of India (1990) 186 ITR 634 (Cal)

Counsel for the petitioner submits that the amendment in section 31 by the insertion of subsection (2A) has retrospective effect and the assessment years for which the interest has been charged -are covered by this amendment. Therefore, interest may be waived. Counsel for the respondent submits that whether the amendment by the insertion of subsection (2A) in section 31 has retrospective effect or not has been considered by this Court in a judgment referred to above and the view has been taken that the amendment has no retrospective effect. He further brought to my notice, the relevant portion of (1984) 149 ITR (St.) 70, wherein the intention of the Legislature was clarified stating that this amendment in section 31 shall take effect from October 1, 1984.

Before giving any direction to the Commissioner for waiver of interest, the petitioner has to satisfy that the amendment by the insertion of subsection (2A) has retrospective effect and, secondly, the conditions under subsection (2A) for waiver of interest have been satisfied. Subsection (2A) of section 31 of the Wealth Tax Act, 1957, reads as under:

"(2A) Notwithstanding anything contained in subsection (2), the Chief Commissioner or Commissioner may reduce or waive the amount of interest paid or payable by an assessee under the said subsection if he is satisfied that--

(i) payment of such amount has caused or would cause genuine hardship to the assessee;

(ii) default in the payment of the amount on which interest has been paid or was payable under the said subsection was due to circumstances beyond the control of the assessee; and

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

No material has been produced before me by counsel for the petitioner that in case the petitioner made payment, it will cause genuine hardship to the petitioner. He placed reliance only on the view taken by the Commissioner in the order under section 220(2A) of the Income-tax Act. No evidence has been produced before me to show that payment of tax would cause genuine hardship and the payment of tax was beyond the control of the petitioner-assessee. At internal page 2 of annexure 1 of the application it has been submitted before the Commissioner that for waiver of interest the petitioner has given some figures regarding the demand raised which reads as under:

"8. That the details of recovery proceedings by the Tax Recovery Officer-II is as under for wealth tax assessment as far as available to the present trustee and sebayet:

In paragraph 10 of the application, the petitioner .has given some figures indicating payment of tax which is as under:

" 10. That the trustee paid tax to the Tax Recovery Officer-IX W.T.):,

If we look into the above figures .they will clearly show that the petitioner has not furnished the complete facts regarding the demand raised of the tax payable from the year 1957 onwards, nor has the petitioner furnished the full facts regarding the wealth tax paid in all these years.

The issue has been considered by this Court in the case of Saurashtra Agencies (Pvt.) Ltd. (1990) 186 ITR 634 whether the amendment by the insertion of subsection (2A) has a retrospective effect or not. This Court has taken the view that this amendment has no retrospective effect. Counsel for. the petitioner submits that whether the amendment has retrospective effect, if it is beneficial to the assessee, it always has retrospective effect.

I am not inclined to accept the contention of counsel for the petitioner that the amendment has retrospective effect not only on the reasons given in the aforesaid decisions of this Court but even the Legislature has made its intention clear by giving the specific date from which this amendment will come into force, i.e., with effect from October 1, 1984. Therefore, there is no question to infer the contrary intention of the Legislature from the specific date given by the Legislature for giving effect to the amendment.

Considering the aforesaid facts, it is not proper to direct the Commissioner to waive the interest not only on the ground that the amendment has no retrospective effect but even the petitioner has filed to satisfy that this case is covered and it fulfilled all the three c6nditiol's laid down in subsection (2A) of section 31 of the Act. Hence, I find no merit its the case of the petitioner on the ground of retrospective effect of amendment nor on the ground that the assessee has fulfilled all the conditions laid down

in subsection (2A) for waiver of interest.

The petition is dismissed.

M.B.A./4241/FCPetition dismissed.