COMMISSIONER OF WEALTH TAX vs TRUSTEES OF SAHEBZADAS OF SARAF-E-KHAS TRUST ETC.

BY THE COURT :

Civil Appeal Nos. 2952-54 of 1979

These appeals are directed against the order of the Andhra Pradesh High Court answering the reference made under s. 27(1) of the WT Act, 1957, at the instance of the Revenue, in favour of the assessee and against the Revenue. The question referred was :

"Whether, on the facts and in the circumstances of the case the penalty to be levied for the asst. yrs. 1962-63, 1963-64 and 1964-65 should be as per the provisions of s. 18(1)(a) as they stood before amendment w.e.f. 1st April, 1965 (sic)."

The High Court answered the said question in favour of the assessee following the earlier decision of the said Court in Commissioner of Wealth-tax Vs. R.D. Chand and V.R. Desai,

In these appeals, it is contended by the learned counsel for the appellant-Revenue that the aforesaid question has to be answered in favour of the Revenue and against the assessee following the decision of this Court in Maya Rani Punj Vs. Commissioner of Income Tax, Delhi, , which has overruled the earlier decision of this Court in Commissioner of Wealth Tax, Amritsar Vs. Suresh Seth, . Though the said decision has been rendered with reference to the provisions of the IT Act, the relevant provisions of the IT Act and the WT Act are similar and the question considered therein was also similar to the one arising herein. Indeed, it overruled the decision in Suresh Seth (supra), which fully supports the assessees contention.

Sri Haris Salve, learned counsel for the respondent-assessee, while not disputing that the said decision concludes the issue against the assessee, submitted that the decision in Maya Rani Punj (supra) requires reconsideration inasmuch as it has not properly appreciated the ratio of the decision in Suresh Seth (supra). Counsel submitted that the overruling of the decision in Suresh Seth (supra) is not correct in law. We have heard Sri Salve at some length but we are not satisfied that there are any good and compelling reasons to depart from the law enunciated in Maya Rani Punj. The decision was rendered by three-Judge Bench and it has fully considered the principle of Suresh Seth (supra) but chose to disagree with it. Not only are we bound by the said decision, we are also not satisfied that there are sufficient grounds warranting reconsideration of the decision in Maya Rani Punj (supra).

Following the said decision, the appeals are allowed. The judgment and order of the High Court is set aside and the question aforementioned is answered in the negative, i.e., in favour of the Revenue and against the assessee. There shall be no order as to costs.

Civil Appeals Nos. 187 to 190 of 1980.

These appeals have been directed to be tagged with Civil Appeals Nos. 2952-2954 of 1979. No separate arguments have been addressed herein. In view of the decision in the said appeal, these appeals too are allowed and the question referred to the High Court is answered in favour of the Revenue and against the assessee. The question which was referred for the opinion of the High Court reads :

"Whether, on the facts and circumstances of the case, the Tribunal was right in holding that the penalties under s. 18(1)(a) for asst. yrs. 1965-66 to 1968-69 were liable to be calculated in accordance with the law as it stood before amendment on 1st April, 1969 even before the period of default after 31st March, 1969 and not as per the increased scale of penalty introduced w.e.f. 1st April, 1969 by the Finance Act, 1969."

Answered accordingly. No costs.