Bhabi Properties Private Limited vs Deputy Commissioner of Income Tax Company Circle-9(1) and Others

Heard Mr. Majumdar, learned Advocate for the applicant/assesses.

Since the issue involved is same, it is disposed of by a common order.

The assessee has filed applications for a stay of the penalty proceedings u/s 18(1)(c) of the Wealth Tax Act, 1957 (hereinafter referred to as the said Act) for the assessment years 1990-91, 1991-92 and 1992-93 initiated by the Assessing Officer and communicated to the assessee by letter dated 8.12.2003/15.1.2004 being Annexure P-10 to the applications.

Mr. Majumdar submitted that the High Court admitted appeals preferred by the assessee u/s 27A of the said Act against the order dated 27.6.2003 passed by the Tribunal for the assessment years 1990-91, 1991-92 and 1992-93, since it found that there were substantial questions of law arising out of the said orders of the Tribunal and the penalty proceedings initiated were relating to the same assessment years. It was submitted that since the said appeals are pending penalty proceedings initiated should be stayed pending hearing of the appeals. Reliance was placed on the judgments of the Apex Court in Cement Marketing Co. of India Ltd. Vs. Assistant Commissioner of Sales Tax, Indore and Others, ; Jaswant Rai and Another Vs. Central Board of Direct Taxes and Revenue and Others, and J.K. Synthetics Limited and Birla Cement Works and another Vs. Commercial Taxes Officer, State of Rajasthan and another, .

We are of the view that the submissions of the learned Advocate for the applicant are not tenable as the penalty proceedings initiated are distinct and separate from the regular proceedings under the said Act. Separate procedure for penalty has been laid down under the said Act. The appeals pending on the file of this Court are with respect to the questions of law arising out of the order of the Tribunal. The scope of the appeal is, therefore, limited to the determination of those questions of law arising out of the order of the Tribunal. The applications filed for stay of the penalty proceedings which do not arise or form part of the

order of the Tribunal is, in our view, therefore, not maintainable. The judgments cited by the learned Counsel do not deal with this aspect of the matter and therefore have no relevance in the facts and circumstances of the case. Hence, the applications are dismissed as not maintainable.

This order shall not preclude the petitioner from taking such proceedings as are open to him in law and as he may he advised with respect to the said penalty proceedings.

However, in the facts and circumstances of the case there shall be no order as to costs.

Later on 11.03. 04

Urgent xerox certified copy of this judgment and order be supplied to the parties on priority basis, if applied for.

M.H.S. Ansari and Soumitra Pal, JJ.