INCOME TAX

INSTRUCTION NO. 3/2002

 Dated: April 10, 2002

Sub:- Order under Section 10(2)(a) of the Wealth Tax Act, 1967

In exercise of the powers conferred under clause (a) of sub-section (2) of section 10 of the Wealth Tax Act, 1957, the Central Board of Direct Taxes, hereby direct that the Chief Commissioner of Wealth Tax and Director General of Wealth Tax may reduce or waive interest charged under Section 17B of the Wealth Tax Act, 1957 in the classes of cases or classes of wealth specified in paragraph 2 of this order for the period and to the extent the Chief Commissioner/Director General of Wealth Tax deem fit. However, no reduction or waiver of such interest shall be ordered unless the assessee has filed the return of wealth for the relevant assessment year and paid the entire tax due on the wealth as assessed except the amount of interest for which reduction or waiver has been requested for. The Chief Commissioner/Director General of Wealth Tax may also impose any other conditions deemed fit for the said reduction or waiver of interest.

2. The classes of wealth or classes of cases in which the reduction or waiver of interest under section 17B of the Wealth Tax Act can be considered are as follows:

(a) Where during the course of proceedings for search and seizure under section 132 of the Income Tax Act, or otherwise, the books of accounts and other incriminating documents have been seized and for reasons beyond the control of the assessee, he has been unable to furnish the return of wealth for the previous year during which the action under section 132 has taken place, within the time specified in this behalf and the Chief Commissioner or, as the case may be, Director General is satisfied having regard to the facts and circumstances of the case that the delay in furnishing such return of wealth cannot reasonably be attributed to the assessee.

(b) Where during the course of search and seizure operation under section 132 of the income Tax Act, cash is seized which is not allowed to be utilised for payment of Wealth Tax which falls due after the seizure of cash and the assessee has not paid partly or fully the Wealth Tax on his current wealth, and the Chief Commissioner or the Director General is satisfied that the assessee is unable to pay the Wealth Tax.

(c) Where a return of wealth could not be filed by the assessee due to unavoidable circumstances and such return of wealth us filed voluntarily by the assessee or his legal heirs without detection by the Assessing Officer.

3. The Chief Commissioner of Wealth-tax/Director General of Wealth-tax may order the waiver or reduction of interest under section 17B of the Wealth Tax Act under this order with reference to the assessment year 1989-90 or any subsequent assessment year but shall not so reduce or waive penal interest in those cases where waiver or reduction of such interest has been rejected in the past on the merits of the case. If any petition in the past has been rejected because the Board had not issued this order earlier, the same may be reconsidered and decided in accordance with this order.

F.No.328/31/2000-WT

(Mohit Jain)
Under Secretary
Central Board of Direct Taxes