HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
Smt. Harbans Kaur v. Commissioner of Wealth-tax, Jullundur
Civil Appeal No. 1334 of 1981 and connected appeals
[1997] 1 SCR 184 ·
Wealth-tax Act, 1957: sections 18(1) and 18B · Income-tax Act, 1961: analogous section 273A
Sources & disclosures includedDownload original judgment / order
Two-judge bench; judgment delivered by K. T. Thomas, J. · B. P. Jeevan Reddy, J. · K. T. Thomas, J.
Assessment years: 1970-71, 1971-72, 1972-73, 1973-74, 1974-75, 1975-76
01 · Facts of the case
The appellants faced penalties for failure to file wealth-tax returns for assessment years 1970-71 through 1975-76. After section 18B was inserted, they filed returns and requested full waiver. The Commissioner found the statutory conditions satisfied but, considering the facts, reduced the penalties to 5% rather than waiving them entirely. The Punjab and Haryana High Court dismissed their writ petitions in limine (SCR pp.184-186; PDF pp.1-3).
02 · Discussion by the Hon’ble Court
Once section 18B's conditions were satisfied, the Commissioner acquired discretion to reduce or waive penalty. The words 'may in his discretion' did not compel complete waiver. Discretion had to be exercised fairly, justly and for relevant reasons, and an order granting only reduction needed to show application of mind. The Court distinguished High Court decisions condemning unreasoned refusal of waiver; they did not establish that full waiver was the only lawful outcome. The judgment noted the analogous discretion under section 273A of the Income-tax Act (SCR pp.186-188; PDF pp.3-5).
03 · Judicial decision
Because the Commissioner had supplied reasons and they were neither unjust nor irrelevant, the Court refused to interfere. The connected appeals were dismissed (SCR pp.188-189; PDF pp.5-6).
Source: Primary judgment: decision
04 · Outcome / in whose favour
In favour of Revenue. The Commissioner's reasoned choice to reduce the historical wealth-tax penalties to 5%, rather than fully waive them, was sustained.
Source: Primary judgment: outcome
05 · AKHB REVIEW POINT
AKHB analysis: satisfying gateway conditions for a discretionary relief provision may establish eligibility for consideration without dictating maximum relief. Check whether the decision-maker identified relevant facts and gave intelligible reasons for the chosen degree of relief. Do not transplant the result mechanically: the Wealth-tax Act is repealed and the wording, purpose and controlling authorities for any current provision must be examined independently.
Source & verification
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Statutory scope
The judgment applies the since-repealed Wealth-tax Act, 1957. Its reference to section 273A is analogical and is not a ruling on the current operation of that income-tax provision.
Later treatment
Source checked 2026-10-11. Later judicial treatment and any present analogy were not comprehensively checked; no current-law or citator clearance is represented.
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