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Mahavir Transport Co. Ltd. Vs. Commissioner of Income-tax, Gujarat-v, Ahmedabad - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtGujarat High Court
Decided On
Case NumberSpecial Civil Application No. 468 of 1976
Judge
Reported in[1978]113ITR360(Guj)
ActsIncome Tax Act, 1961 - Sections 139(1), 271(1) and 271(4A); Wealth Tax Act, 1957 - Sections 18(2A)
AppellantMahavir Transport Co. Ltd.
RespondentCommissioner of Income-tax, Gujarat-v, Ahmedabad
Appellant Advocate K.C. Patel, Adv.
Respondent Advocate N.U. Raval, Adv.
Cases ReferredMadhukar Manilal Modi v. Commissioner of Wealth
Excerpt:
.....of relief and since the assessee, who had already been assessed to tax in the previous years, had filed returns for the assessment years in question under such circumstances, it could not be said that those returns were filed voluntarily and that, therefore, the condition precedent to the grant of relief was not satisfied. it is true that in the impugned order, towards the end, the commissioner has also mentioned that considering the facts of the case he was satisfied that this was not a fit case for waiver or reduction of the penalties. on a true construction of section 18(2a), we have there held that the word 'voluntarily' occurring in the relevant statutory provision has to be read with 'made full disclosure of his net wealth' and that the concept of voluntary filing of return is..........of relief and since the assessee, who had already been assessed to tax in the previous years, had filed returns for the assessment years in question under such circumstances, it could not be said that those returns were filed voluntarily and that, therefore, the condition precedent to the grant of relief was not satisfied. it is true that in the impugned order, towards the end, the commissioner has also mentioned that considering the facts of the case he was satisfied that this was not a fit case for waiver or reduction of the penalties. however, on reading the order as a whole, it appears that the ground on which the relief has been really rejected is the ground which is set out in the extracted portion of the impugned order.2. now, we had today an occasion to deal with a case arising.....
Judgment:

P.D. Desai, J.

1. The petitioner, which is a registered partnership firm, is assessable to income-tax. For assessment years 1967-68, 1968-69 and 1969-70 it was required to file its return of income before June 30, 1967, June 30, 1968, and June 30, 1969, respectively, under section 139(1)(a) of the Income-tax Act. It, however, filed its returns for those assessment years on March 19, 1969, October 23, 1969, and October 23, 1969, respectively. Under section 271(1)(a) the Income-tax Officer is empowered, if he is satisfied that any person has without reasonable cause failed to furnish the return which he was required to furnish under sub-section (1) of section 139 within the time allowed, to direct that such person shall pay by way of penalty the amount to be computed in accordance with the provisions made in the said section. In the present case, in view of the returns for the three assessment years having been furnished beyond the prescribed time limit, the Income-tax Officer passed an order on March 25, 1974, levying penalties of Rs. 15,457, Rs. 14,867 and Rs. 921 for the three assessment years in question respectively. Be it noted that the amounts of penalties imposed as aforesaid were the minimum imposable under the provisions of the Act. Thereupon the petitioner filed applications under section 271(4A), before the Commissioner on October 11, 1974, requesting him to reduce or waive the amount of minimum penalty imposed upon him by the Income-tax Officer. The Commissioner rejected this request of the petitioner by his order dated August 16,1975, which is annexed as exhibit 'D' to the petition. The ground on which the request was rejected is recorded in the following words in the said order :

'On a perusal of the records it was noticed that the assessee firm was on GIR prior to filing the returns of income for the assessment years 1967-68 to 1969-70 and that it was assessed for and from the assessment years 1967-68 to 1969-70. Hence the returns of income filed by the assessee for these years were not voluntary returns. Filing the returns of income voluntarily is one of the conditions laid down in section 271(4A) for waiver or reduction of the penalties under section 271(1)(a). For the reasons stated above, I am satisfied that this condition has not been fulfilled in this case.' It would appear, therefore, that the relief was refused on the ground that since the filing of return of income voluntarily was one of the conditions laid down by law for the grant of relief and since the assessee, who had already been assessed to tax in the previous years, had filed returns for the assessment years in question under such circumstances, it could not be said that those returns were filed voluntarily and that, therefore, the condition precedent to the grant of relief was not satisfied. It is true that in the impugned order, towards the end, the Commissioner has also mentioned that considering the facts of the case he was satisfied that this was not a fit case for waiver or reduction of the penalties. However, on reading the order as a whole, it appears that the ground on which the relief has been really rejected is the ground which is set out in the extracted portion of the impugned order.

2. Now, we had today an occasion to deal with a case arising under section 18(2A) of the Wealth-tax Act, which provision is identical to the provision of section 271(4A) of the Act under consideration [See Special Civil Application No.1265 of 1975 decided on February 16/17, 1978-since reported as Madhukar Manilal Modi v. Commissioner of Wealth-tax : [1978]113ITR318(Guj) ]. In that case also on a similar ground the relief under section 18(2A) was rejected by the Commissioner. On a true construction of section 18(2A), we have there held that the word 'voluntarily' occurring in the relevant statutory provision has to be read with 'made full disclosure of his net wealth' and that the concept of voluntary filing of return is irrelevant for the purpose of grant of relief accept to the extent that it must be shown that the return was not filed pursuant to a notice issued under section 14(2). Since the language of section 18(2A) and section 271(4A) is in pari materia, so far as the point under consideration is concerned, we must, following the said decision, held in the present case that the relief which the petitioner sought was refused to him on a total misconstruction of the relevant statutory provision which resulted in failure on the part of the Commissioner to exercise the discretion which was vested in him.

3. In the result, the writ petition succeeds and is allowed. The Commissioner will reconsider the matter and determine the question of grant of relief afresh in accordance with law and in the light of the observations made in this judgment.

4. Rule is accordingly made absolute. The Commissioner will pay the costs of this petition to the petitioner.


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