COMMISSIONER OF INCOME-TAX VS KUKU NARANG
2001 P T D 1929
[246 I T R 198]
[Delhi High Court (India)]
Before Arijit Pasayat, C.J..and D. K. Jain, J
COMMISSIONER OF INCOME‑TAX
Versus
Mrs. KUKU NARANG Wealth Tax
Reference No.41 of 1979, decided on 04/07/2000.
Wealth tax----
‑‑‑‑Penalty‑‑‑Reference‑‑‑Concealment of wealth‑‑‑Finding by Tribunal that there had been clerical errors and no concealment of wealth‑‑‑Finding of fact‑‑‑No question of law arose from it‑‑‑Indian Wealth Tax Act, 1957.
Held, that the conclusions of the Tribunal are essentially factual in nature. It had clearly come to the conclusion that the omissions were not deliberate and it was a clerical mistake with no contumacious conduct or conscious act involved. Such finding of fact did not give rise to any question of law.
Sanjiv Khana with Ajay Jha for the Commissioner.
Nemo for the Assessee.
JUDGMENT
ARIJIT PASAYAT, C.J.‑‑‑On being moved by the Revenue under section 27(1) of the Wealth Tax Act, 1957 (for short "the Act"), the Income-tax Appellate Tribunal, Delhi Bench‑C (for short "the Tribunal"), has referred the following question for the opinion of this Court:
"Whether, on the facts and circumstances of the case, the Tribunal was right in cancelling the penalty of Rs.25,000 levied under section 18(1)(c) of the Wealth Tax Act, 1957?"
The factual position, as stated in the statement of the case, is as
For the assessment year 1971‑72, the assessee filed her return declaring net wealth of Rs.1,36,083. The Wealth Tax Officer completed the assessment on a total wealth of Rs.1,71,040. During the assessment proceedings, the Assessing Officer noticed two omissions on the part of the assessee. The first omission related to remuneration receivable from J. Bond & Company (Private) Limited amounting to Rs.18,700 and the second one related to income from boats receivable, amounting to Rs.3,252 which was disclosed at Rs.1,134. A number of other minor additions were also made while computing the wealth. The Assessing Officer was of the view that there was concealment of particulars in respect of the assets or that the assessee had furnished inaccurate particulars thereby attracting levy of penalty provisions of section 18(1)(c) of the Act. Proceedings were initiated against the assessee. Since the difference between the declared wealth and the assessed wealth exceeded Rs.25,000, the Assessing Officer referred the matter to the Inspecting Assistant Commissioner ("the IAC" for short) under section 18(3) of the Act for ‑finalisation of penalty proceeding. In response to the notice issued by the Inspecting Assistant Commissioner, the assessee submitted her explanation. After considering the same; the Inspecting Assistant Commissioner levied penalty in respect of the two items referred to above. The matter was carried in appeal before the Tribunal by the assessee. It was contended that there was a bona fide omission and there was no conscious concealment of wealth and no contumacious conduct was involved. The Revenue's stand was that there was deliberate concealment and/or omission, clearly attracting the provisions of section 18(1)(c) of the Act. The Tribunal accepted the plea of the assessee that the omissions were bona fide and cancelled the notice. It was, inter alia, observed by it as follows:
"Before us these conclusions of the Inspecting Assistant Commissioner have been assailed and we .are of the opinion that there is force in the appellant's argument. So far as the income from boats is concerned, the copy of the particulars of wealth filed alongwith the return, which is at pages 1 and 2 of the paper book, would show that although the value of the boat income is mentioned at Rs.1,133,83 it has been specifically pointed out that the amount was taken professionally and the exact figure shall be submitted at the time of assessment. This has been done by putting an asterisk (1) mark against the item so that it was not a case of concealment at all. Regarding the other item, namely, the amount receivable from J Bond & Company, it is not the case of the Department that this item was never mentioned in the return. In fact, this item has been continuously mentioned even earlier as the return for the assessment year 1970‑71 shows. There the amount mentioned was Rs.6,700. During the current year another Rs.12,000 were added and a certificate of J. Bond & Company at page 13 of the paper book would show that a sum of Rs.14,400 was paid to the appellant as remuneration from April 1, 1970 to March 31, 1971, and even income‑tax was deducted on this amount. It is contended by the appellant that at the time of preparing the return the clerk concerned thought that all these amounts had already been received by the appellant, and, therefore, nothing was left receivable. No doubt, it is a mistake and rather a serious mistake, but one thing is certain that there could not have been any intention to defraud the taxation department because the heading remuneration receivable from J Bond & Company (Pvt.) Ltd. is specifically mentioned in the statement showing the particulars of wealth."
It was further held by the Tribunal that the difference between the disclosed wealth and the assessed wealth was not beyond the permissible limit to deem concealment and, therefore, penalty was not attracted.
Learned counsel for the Revenue submitted that the factual position as highlighted by the Assessing Officer clearly established that there was an attempt by the assessee to conceal wealth and/or to omit it and, therefore, penal provisions were clearly attracted. There is no appearance on the part of the assessee in spite of service of notice.
We are of the view that the conclusions of the Tribunal are essentially factual in nature with reference to the background facts. It has clearly come to the conclusion that the omissions were not deliberate and it was a clerical mistake with no contumacious conduct or conscious act involved. Such finding of fact does not give rise to any question of law. We, therefore, decline to answer the question referred.
M.B.A./508/FC ????????????????????????????????????????????????????????????????????????????????? Question answered.