Full Judgment Text
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PETITIONER:
COMMISSIONER OF WEALTH TAX, AMRITSAR
Vs.
RESPONDENT:
SURESH SETH
DATE OF JUDGMENT07/04/1981
BENCH:
VENKATARAMIAH, E.S. (J)
BENCH:
VENKATARAMIAH, E.S. (J)
PATHAK, R.S.
CITATION:
1981 AIR 1106 1981 SCR (3) 419
1981 SCC (2) 790 1981 SCALE (1)729
CITATOR INFO :
D 1984 SC1194 (28)
O 1986 SC 293 (13,15,16,18)
ACT:
Wealth Tax Act, 1957-Scope of section 18(1) (a) of the
Act-Whether the offence relating to the omission to file the
Wealth Tax Returns was a continuing offence-Penalty has to
be computed in accordance with the law in force on the last
day on which the return in question has to be filed-The 1964
and 1969 Amendments to the Wealth Tax Act has no
retrospective effect.
HEADNOTE:
The assessee-respondent filed his Wealth Tax returns
for the assessment years 1964-65 and 1965-66 on March 18,
1971, while he was required by section D 14(1) of the Act to
file the return for the assessment year 1964-65 on or before
June 30, 1964 and the return for the assessment year 1965-66
on or before June 30, 1965. The Wealth Tax officer completed
the assessment for the said years on March 22, 1971 and also
commenced proceedings for levying penalty under section
18(1) (a) of the Act for the late submission of returns. The
Wealth Tax officer levied the penalties for different
periods at different rates, as provided by the 1964 and 1969
Amendments. treating the failure to file the return in time
as a "continuing offence". The orders levying penalties were
upheld in appeal by the Appellate Assistant Commissioner and
the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar.
A consolidated reference made by the Tribunal at the
instance of the assessee was answered by the High Court of
Punjab in favour of the assessee after rejecting the
contention of the department that the default or failure to
file the return in time was a continuing default and that
the penalty had to be computed for the period prior to April
1, 1965 in accordance with section 18 as it stood prior to
its amendment by the Wealth-tax (Amendment) Act, 1964, for
the period between April 1, 1965 to March 31, 1969 in
accordance with section 18 of the Act as amended by the
Wealth-tax (Amendment) Act, 1964 and for the period between
April 1, 1969 to March 18, 1971 (on which date the returns
were filed) in accordance with section 18 of the Act as
amended by the Finance Act, 1969. Aggrieved by the decision
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of the High Court, the Department has filed these appeals
under Article 136 of the Constitution. G
Dismissing the appeals, the Court
^
HELD 1:1. Where the default complained of is one
falling under section 18(1) (a) of the Wealth Tax Act, the
penalty has to be computed m accordance with the law in
force on the last day on which the return in question had to
be filed. Neither the amendment made in 1964 nor the
amendment made in 1969 has retrospective effect. [434 C-D]
420
1:2. Section 18 of the Wealth Tax Act does not require
the assessee to file a return during every month after the
last day to file it is over. Non-performance of any of the
acts mentioned in section 18(1) (a) of the Act gives rise to
a single default and to a single penalty, the measure of
which, however, is geared up to the time lag between the
last date on which the return has to be filed and the date
on which it is filed. The default, if any committed is
committed on the last date allowed to file the return. The
default cannot be one committed every month thereafter. [433
G-H, 434 A]
1:3. The words "for every month during which the
default continued" indicate only the multiplier to be
adopted in determining the quantum of penalty and do not
have the effect of making the default in question a
continuing one. Nor do they make the amended provisions
modifying the penalty applicable to earlier defaults in the
absence of necessary provisions in the amending Acts. The
principle underlying section 6 of the General Clauses Act is
clearly applicable to these cases. [434 B-C]
2:1. A liability in law ordinarily arises out of an act
of commission or an act of omission. When a person does an
act which law prohibits him from doing it and attaches a
penalty for doing it, he is stated to have committed an act
of commission which amounts to a wrong in the eye of law.
Similarly when a person omits to do an act which is required
by law to be performed by him and attaches a penalty for
such omission, he is said to have committed an act of
omission which is also a wrong in the eye of law. Ordinarily
a wrongful act or failure to perform an act required by law
to be done becomes a completed act of commission or of
omission, as the case may be, as soon as the wrongful act is
committed in the former case and when the time prescribed by
law to perform an act expires in the latter case and the
liability arising therefore gets fastened as soon as the act
of commission or of omission is completed. The extent of
that liability is ordinarily measured according to the law
in force at the time of such completion. In the case of acts
amounting to crimes the punishment to be imposed cannot be
enhanced at all under our Constitution by any subsequent
legislation by reason of Article 20(I) of the Constitution
which declares that no person shall be subjected to a
penalty greater than that which might have been inflicted
under the law in force at the time of the commission of the
offence. In other cases, however, even though the liability
may be enhanced it can only be a subsequent law (of course
subject to the Constitution which either by express words or
by necessary implication provides for such enhancement. [429
G-H, 430 A-D]
2:2. The distinctive nature of a continuing wrong is
that the law that is violated makes the wrongdoer
continuously liable for penalty. A wrong or default which is
complete but whose effect may continue to be felt even after
its completion is, however, not a continuing wrong or
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default. [430 D-E]
2:3. The court should not be eager to hold that an act
or omission is a continuing wrong or default unless there
are words in the statute concerned which make out that such
was the intention of the legislature. In the instant case
when ever the question of levying penalty arises what has to
be first considered is whether the assessee has failed
without reasonable cause to file the return as re-
421
quired by law and if it is held that he has failed to do so
then penalty has to be levied in accordance with the measure
provided in the Act. When the default is the filing of a
delayed return the penalty may be correlated to the time lag
between the last day for filing it without penalty and the
day on which it is filed and the quantum of tax or wealth
involved in the case for purposes of determining the quantum
of penalty but the default however is only one which takes
place on the expiry of the last day for filing the return
without penalty and not a continuing one. The default in
question does not, however, give rise to a fresh cause of
action every day. [430 E-H]
2:4. Where the wrong complained of is the omission to
perform a positive duty requiring a person to do a certain
act the test to determine whether such a wrong is a
continuing one is whether the duty in question is one which
requires him to continue to do that act. Breach or a
covenant to keep the premises in good repair, breach of a
continuing guarantee obstruction to a right of way,
obstruction to the right of a person to the unobstructed
flow of water, refusal by a man to maintain his wife and
children whom he is bound to maintain under law and the
carrying on of mining operations or the running of a factory
without complying with the measures intended for the safety
and well-being of workmen may be illustrations of continuing
breaches or wrongs giving rise to civil or criminal
liability, as the case may be, de die in diem. [433 A-D]
Hole v. Chard Union, [1894] 1 Ch. D. 293, quoted with
approval.
State v. A. Bhiwandiwalla, A. I. R. 1955 Bom. 161; The
State v. Kunja Behari Chandra and Ors. A.I.R. 1954 Patna
371, approved,
Balkrishna Savalram Pujari and Ors. v. Shree
Dayaneshwar Maharaj Sansthan and Ors., [1959] Supp. 2 S.C.R.
476, referred to.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 768-769
of 1978.
Appeals by Special Leave from the Judgment and order
dated 28.1.1977 of the Punjab and Haryana High Court in
Income Tax Reference No. 29 of 1975.
B.B. Ahuja and Miss A. Subhashini for the Appellant.
G.C. Sharma, E.D. Helms, R.S. Sharma and K.B. Rohtagi
for the Respondent.
The Judgment of the Court was delivered by
VENKATARAMIAH, J. The Commissioner of Wealth Tax,
Amritsar has filed the above appeals by special leave
against the judgment of the High Court of Punjab and Haryana
in a reference made under section 27(1) of the Wealth-tax
Act, 1957 (hereinafter
422
referred to as ’the Act’) answering in favour of the
assessee the following two questions:
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"1. Whether, on the facts and in the circumstances
of the case, the Tribunal was right in law in holding
that the offence relating to the omission to file the
Wealth tax returns was a continuing offence ?
2. Whether, on the facts and in the circumstances
of the case, the Tribunal was right in law upholding
the penalties of Rs. 5382/- and Rs. 7759/- levied by
the department on the assessee under section 18(1)(a)
of the Wealth-tax Act, 1957, for the assessment years
1964-65 and 1965-66 respectively ?"
The assessee, the respondent in these appeals filed his
wealth tax returns for the assessment years 1964-65 and
1965-66 on March 18, 1971 while he was required by section
14(1) of the Act to file the return for the assessment year
1964-65 on or before June 30, 1964 and the return for the
assessment year 1965-66 on or before June 30, 1965. The
Wealth-tax Officer completed the assessments for the
aforementioned years on March 22, 1971 determining the total
wealth at Rs. 1,45,800/- for the assessment year 1964-65 as
against the declared wealth of Rs. 1,38,550/- and at Rs.
1,65,200/- for the assessment year 1965-66 as against the
declared wealth of Rs. 1,59,127/- and also commenced
proceedings for the levying penalty under section 18(1)(a)
of the Act for late submission of returns. Ultimately the
penalties were levied as follows:
"Assessment year 1964-65:
(i) For the period from 1.7.64 to 31.3.69:
Penalty at 2% p.m. subject to maximum
of 50% of the wealth-tax payable under
section 18(1)(a) before its amendments
on 1.4.69 by the Finance Act, 1969: Rs. 115/-
(ii) For the period from 1.4.69 to 18.3.71:
Penalty at 1/2% of the net wealth for
each month of the default under section
18(1)(a) as amended by the Finance
Act, 1969: Rs. 5,267/-
-------
Rs. 5,382/-
423
Assessment year 1965-66:
(i) For the period from 1.7.65 to 30.3.69:
Penalty at 2% p.m. subject to maximum of
50% of the wealth-tax payable under
section 18(1)(a) before its amendment
on 1.4.69 by the Finance Act, 1969: Rs.163/-
(ii) For the period from 1.4.69 to 18.3.71:
Penalty at 1/2% of the net wealth for
each month of default under section
8(1)(a) as amended on 1.4.69 by the
Finance Act, 1969: Rs. 7,596/-
-------
Rs. 7,759/-
The above orders levying penalties were upheld in
appeal by the Appellate Assistant Commissioner and the
Income-tax Appellate Tribunal, Amritsar Bench, Amritsar. At
the instance of the assessee a consolidated reference was
made by the Income-tax Appellate ’Tribunal to the High Court
referring the above two questions for its opinion. The High
Court answered the said questions in favour of the assessee
after rejecting the contention of the department that the
default or failure to file the return in time was a
continuing default and that the penalty had to be computed
for the period prior to April 1, 1965 in accordance with
section 18 as it stood prior to its amendment by the Wealth-
tax (Amendment) Act, 1964, for the period between April 1,
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1965 to March 3], 1969 in accordance with section 18 of the
Act as amended by the Wealth-tax (Amendment) Act, 1964 and
for the period between April 1, ]969 to March 18, 1971 (on
which date the returns were filed) in accordance with sec.
18 of the Act as amended by the Finance Act, 1966. Aggrieved
by the decision of the High Court, the Department has filed
these appeals under Article 136 of the Constitution .
Before dealing with the contentions of the parties, it
is appropriate to set out the provisions of the Act which
have a bearing on the question involved in the present
appeals as they stood during the relevant periods:
Prior to April 1, 1965, sub-sections (1) and (3) of
section 14 of the Act stood as follows:-
424
"14. Return of wealth-(1) Every person whose net
wealth on the valuation date was of such amount as to
render him liable to wealth-tax under this Act shall,
before the thirtieth day of June of the corresponding
assessment year, furnish to the Wealth-tax officer a
return in the prescribed form and verified in the
prescribed manner setting forth his net wealth as on
the valuation date;
(2)...............
(3) The Wealth-tax officer may, if he is satisfied
that it is necessary so to do, extend the date for the
delivery of return under this section."
After April 1, 1965:
"14. (1) Every person, if his net wealth or the
net wealth of any other person in respect of which he
is assessable under this Act on the valuation date was
of such an amount as to render him liable to wealth-tax
under this Act, shall, before the thirtieth day of June
of the corresponding assessment year, furnish to the
Wealth-tax officer a return in the prescribed form and
verified in the prescribed manner setting forth the net
wealth as on the valuation date.
(2)...............
(3) The Wealth-tax officer may, if he is satisfied
that it is necessary so to do, extend the date for the
delivery of the return under this section."
Section 15 of the Act which has not undergone any
change since the commencement of the Act reads:
"15. Return after due date and amendment of
return-If any person has not furnished a return within
the time allowed under section 14 or having furnished a
return under that section discovers any omission or a
wrong statement therein, he may furnish a return or a
revised return, as the case may be, at any time before
the assessment is made."
The relevant parts of section 18 of the Act as they
stood during the three periods referred to above read as
follows:-
425
Prior to April 1, 1965
"18. (1) If the Wealth-tax officer, Appellate
Assistant Commissioner, Commissioner or Appellate
Tribunal in the course of any proceedings under this
Act is satisfied that any person-
(a) has without reasonable cause failed to furnish the
return of his net wealth which he is required to
furnish under sub-section (1) or sub-section (2)
of section 14 or section 17 or has without
reasonable cause failed to furnish it within the
time allowed and in the manner required; or
(b) ......
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(c) .........
he or it may, by order in writing, direct that such
person shall pay by way of penalty-
(i) in the case referred to in clause (a), in addition
to the amount of wealth-tax payable by him, a sum
not exceeding one and a half times the amount of
such tax, and .. "
Between April 1, 1965 and March 31, 1969
"18. (1) If the Wealth-tax officer, Appellate
Assistant Commissioner, Commissioner or Appellate
Tribunal in the course of any proceedings under this
Act is satisfied that any person-
(a) has without reasonable cause failed to furnish the
return of his net wealth which he is required to
furnish under sub-section (a) of section 14 or by
notice given under sub-section (2) of section 14
or section 17 or has without reasonable cause
failed to furnish it within the time allowed and
in the manner required by sub-section (1) of
section 14 or by such notice, as the case may be;
or
(b) ............
(c) ............
426
he or it may, by order in writing, direct that such
person shall pay by way of penalty-
(i) in the cases referred to in clause (a), in
addition to the amount of wealth-tax, if any,
payable by him, a sum equal to two per cent of the
tax for every month during which the default
continued, but not exceeding in the aggregate
fifty per cent of the tax;
After April 1, 1969 and as on March 18, 1971 on
which date the returns were filed
"18. (1) If the Wealth-tax officer, Appellate
Assistant Commissioner, Commissioner or Appellate
Tribunal in the course of any proceedings under this
Act is satisfied that any person-
(a) has without reasonable cause failed to furnish the
return which he is required to furnish under sub-
section (1) of section 14 or by notice given under
sub-section (2) of section 14 or section 17, or
has without reason able cause failed to furnish
within the time allowed and in the manner required
by sub-section (1) of section 14 or by such
notice, as the case may be; or
(b) ..........
(c) ..........
he or it may, by order in writing, direct that such
person shall pay by way of penalty-
(i) in the cases referred to in clause (a), in
addition to the amount of wealth-tax, if any,
payable by him, a sum, for every month during
which the default continued, equal to one-half per
cent of-
(A) the net wealth assessed under section 16, as
reduced by the amount of net wealth on which in
accordance with the rates of wealth tax specified
in Paragraph A of Part I of the Schedule or Part
II of the Schedule, the wealth-tax chargeable is
nil; or
(B) the net wealth assessed under section 17, where
assessment has been made under that section, as
reduced by-
427
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(1) the net wealth, if any, assessed previously under
section 16 or section 17 or
(2) the amount of net wealth on which in accordance
with the rates of wealth-tax specified in
Paragraph A of Part I of the Schedule or Part II
of the Schedule, the wealth tax chargeable is nil,
whichever is greater, but not exceeding, in the
aggregate, an amount equal to the net wealth
assessed under section 16, or, as the case may be,
the net wealth assessed under section 17, as
reduced in either case in the manner
aforesaid;........"
Now let us analyse the above provisions of law. Section
14 of the Act which has not undergone any material change
from the commencement of the Act in so far as the question
involved in these appeals is concerned requires a person the
value of whose wealth is such as would attract the liability
to pay tax to file a return of his wealth as on the
valuation date in the prescribed manner before the Wealth-
tax Officer on or before the thirtieth of June of the
assessment year or on or before any date upto which the
Wealth-tax officer has extended the time to file the return.
Section 15 of the Act, however, enables such a person to
file a return at any time before the assessment is made. The
distinction between section 14 and section 15 of the Act
lies in the fact that whereas under section 14 a duty is
imposed on the assessee to file a return within the
prescribed date, section 15 enables him to file a return
before the assessment is made even though the last date
prescribed by section 14(1) is over. Section 18 of the Act
deals with three types of penalties for certain specified
acts or omissions on the part of the assessee referred to in
clauses (a), (b) and (c) of sub-section (1) thereof. We are
concerned in this case with the question of levy of penalty
in respect of omissions referred to in clause (a) of section
18(1) of the Act. There are four kinds of omissions referred
to in that clause-(i) failure to furnish the return which
the assessee is required to furnish under sub-section (i) of
section 14; (ii) failure to furnish the return as required
by a notice issued under section 14(2) or section 17, (iii)
failure to furnish the return as required by section 14(1)
within the time allowed and in the prescribed manner and
(iv) failure to furnish the return as required by a notice
issued under section 14(2) or section 17 within the time
allowed and in the prescribed manner. Each one of these
omissions expose the assessee to the levy of penalty unless
reasonable cause is shown for not performing
428
the duty. In clause (i) of section 18(1) of the Act, the
penalty leviable for any of the omissions referred to in
section 18(1)(a) is set out but the measure of penalty
imposable has varied from time to time. Prior to April 1,
1965 the penalty imposable was a sum not exceeding one and a
half times the amount of wealth tax payable by the assessee
during the assessment year in question. Within the outer
limit referred to above, The officer concerned or the
Tribunal as the case may be could impose any amount as
penalty having regard to all the relevant circumstances of
the case including perhaps the time that had elapsed from
the last day allowed to file the return. Between April 1,
1965 and March 31, 1969 the measure of penalty was regulated
by section 18 of the Act as amended in 1964. During that
period the penalty imposable was a sum equivalent to two per
cent of the tax for every month during which the default
continued but not exceeding in the aggregate fifty per cent
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of the tax. The penalty leviable during this period was less
onerous than it was before April 1, 1965. Then came the
amendment made by the Finance Act of 1969. After April 1,
1969 by reason of the amendment introduced by the Finance
Act of 1969 the penalty imposable was altered to a sum for
every month during which the default continued equal to one-
half per cent of the net wealth calculated in accordance
with the amended provisions in section 18. The penalty
leviable during this period was more drastic than what it
was before. One significant difference between the law as it
existed prior to April 1, 1965 and the law as it existed
during the subsequent two periods is that whereas during the
period prior to April I, 1965 there was no specific
reference in clause (i) of section 18 (a) to the time lag
between the last date on which the return had to be filed
and the date on which it was actually filed, the said factor
was expressly required to be taken into consideration after
April 1, 1965 while determining the penalty payable by the
assessee. Another significant factor which requires to be
borne in mind is that neither the Wealth-tax (Amendment)
Act, 1964 nor the Finance Act, 1969 by which section 18 of
the Act was amended expressly stated that the amended
provisions of section 18 would be applicable to an assessee
who had failed to file the return in respect of any
preceding assessment year and the said default had continued
after the amendment came into force except using the phrase
"for every month during which the default continued", in
that part of section 18 which prescribed the measure of
penalty.
The contention of the Department is that whatever may
have been the position of law before April 1, 1965, on and
after that date
429
the default committed by an assessee in not filing a return
as required by section 14(1) of the Act amounted to a
continuing wrong which attracted the penalty as provided by
the law in force at the time when such default continued. In
other words it is contended that in this case since the
assessee who had to file a return after April 1, 1965 for
assessment year 1965-66 had not f led the same till March
13, 1971 penalty had to be computed for the period upto
April 1, 1969 under the provisions of section 18 of the Act
as it stood during that period and for the subsequent period
additional penalty should be levied in accordance with
section 18 as amended by the Finance Act, 1969. Relying upon
the decision of the Kerala High Court in Commissioner of
Wealth-tax, Kerala v. Smt. V. Pathummabi it is argued that
amendments made in 1964 and 1969 brought about a qualitative
change in the nature of the default contemplated under
section 18 and that what could have been a completed default
before April 1, 1965 became a continuing default. Even
assuming that this argument is correct it has to be held
that the decision of the High Court in so far as the default
committed by the assessee in not filing the return in
respect of the assessment year 1964-65 is concerned is not
erroneous. What remains to be considered is whether the
decision in respect of the default committed by the assessee
in not filing the return due on June 31), 1955 for the
assessment year 1965-66 is liable to be interfered with.
To repeat, the relevant part of section 18 of the Act
can be divided into two parts-the first part contained in
clause (a) of section 18(1) setting out the gist of the
default and the second part prescribing the measure of
penalty. The former part has more or less remained the same
from the commencement of the Act and it is only the latter
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part which has undergone changes. The question is whether by
reason of the changes in the latter pari, there has been a
change in the nature of the wrong referred to in section 18
(1) (a) of the Act.
A liability in law ordinarily arises out of an act of
commission or an act of omission. When a person does an act
which law prohibits him from doing it and attaches a penalty
for doing it, he is stated to have committed an act of
commission which amounts to a wrong in the eye of law.
Similarly when a person omits to do an act which is required
by law to be performed by him and attaches a penalty for
such omission, he is said to have
430
committed an act of omission which is also a wrong in the
eye of law. Ordinarily a wrongful act or failure to perform
an act required by law to be done becomes a completed act of
commission or omission, as the case may be, as soon as the
wrongful act is committed in the former case and when the
time prescribed by law to perform an act expires in the
latter case and the liability arising therefrom gets
fastened as soon as the act of commission or of omission is
completed. The extent of that liability is ordinarily
measured according to the law in force at the time of such
completion. In the case of acts amounting to crimes the
punishment to be imposed cannot be enhanced at all under our
Constitution by any subsequent legislation by reason of
Article 20 (I) of the Constitution which declares that no
person shall be subjected to a penalty greater than that
which might have been inflicted under the law in force at
the time of the commission of the offence. In other cases,
however, even though the liability may be enhanced it can
only be done by a subsequent law (of course subject to the
Constitution) which either by express words or by necessary
implication provides for such enhancement. In the instant
case the contention is that the wrong or the default in
question has been altered into a continuing wrong or default
giving rise to a liability de die in diem, that is, from day
to day. The distinctive nature of a continuing wrong is that
the law that is violated makes the wrong doer continuously
liable for penalty. A wrong or default which is complete but
whose effect may continue to be felt even after its
completion is, however, not a continuing wrong or default.
It is reasonable to take the view that the court should not
be eager to hold that an act or omission is a continuing
wrong or default unless there are words in the statute
concerned which make out that such was the intention of the
legislature. In the instant case whenever the question of
levying penalty arises what has to be first considered is
whether the assessee has failed without reasonable cause to
file the return as required by law and if it is held that he
has failed to do so then penalty has to be levied in
accordance with the measure provided in the Act. When the
default is the filing of a delayed return the penalty may be
correlated to the time lag between the last day for filing
it without penalty and the day on which it is filed and the
quantum of tax or wealth involved in the case for purposes
of determining the quantum of penalty but the default
however is only one which takes place on the expiry of the
last day for filing the return without penalty and not a
continuing one. The default in question does not, however,
give rise to a fresh cause of action every day. Explaining
the expression
431
’a continuing cause of action’ Lord Lindley in Hole v. Chard
Union observed:
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"What is a continuing cause of action ? Speaking
accurately, there is no such thing; but what is called
a continuing cause of action is a cause of action which
arises from the repetition of acts or omissions of the
same kind as that for which the action was brought."
In the same decision, Lord Justice A. L. Smith who
concurred with the above view said:
"If once a cause of action arises, and the acts
com plained of are continuously repeated, the cause of
action continues and goes on de die in diem. It seems
to me that there was a connection in the present case
between the series of acts before and after the action
was brought; they were repeated in succession, and
became a continuing cause of action. They were an
assertion of the same claim-namely, a claim to continue
to pour sewage into the stream-and a continuance of the
same alleged right. In my opinion, there was here a
continuing cause of action within the meaning of the
rule."
The distinction between a continuing offence and an
offence which is not a continuing one is well brought out in
the decision of the High Court of Bombay in State v. A. H.
Bhiwandiwalla. In that case, the accused-respondent had been
charged with two offences namely, (a) failure to apply for
registration of his factory and to give notice of occupation
and (b) running the factory without a licence issued under
the Factories Act, 1948. The accused had a plea of
limitation against the prosecution. In that context the High
Court observed:
"In civil law, we often refer to a continuing or
recurring cause of action. Similarly, even in criminal
law the expression "continuing offence" is frequently
used. As observed by Beaumount C. J. in-’Emperor v.
Chhotalal Amarchand’, AIR 1937 Bom 1 (FB) the
expression "continuing offence" is not a very happy
expression. It assumes, says the learned Chief Justice-
432
".. that you can have a continuing offence in the
sense in which you can have a continuing tort, or
a continuing breach of contract, and I doubt,
myself whether the assumption is well founded,
having regard to the provisions of the Criminal
Procedure Code as to the framing of charges and as
to the charges which can be tried at one and the
same trial. It is quite clear that you could not
charge a man with committing an offence ’de die in
diem’ over a substantial period."
Even so, this expression has acquired a well-
recognised meaning in criminal law. If an act committed
by an accused person constitutes an offence and if that
act continues from day to day, then from day to day a
fresh offence is committed by the accused so long as
the act continues. Normally and in the ordinary course
an offence is committed only once. But we may have
offences which can be committed from day to day and it
is offences falling in this latter category that are
described as continuing offences."
Accordingly the High Court of Bombay held in
Bhiwandiwalla’s case (supra) that the failure to apply for
registration of the factory under the Factories Act and to
give notice of occupation thereof was not a continuing
offence but the running of the factory without a licence
issued thereunder was a continuing offence.
Section 39 of the Indian Mines Act, 1923 which came up
for consideration before the Patna High Court in The State
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v. Kunja Behari Chandra & Ors. on which reliance was placed
by the Revenue is a case of continuing offence. Section 39
provided:
"39. Whoever contravenes any provision of this Act
or of any regulation, rule or bye-law or of any order
made thereunder for the contravention of which no
penalty is hereinafter provided shall be punishable
with fine which may extend to one thousand rupees, and
in the case of a continuing contravention, with a
further fine which may extend to one hundred rupees for
every day on which the offender is proved to have
persisted in the contravention after the date of the
first conviction."
433
In this case the language of the section itself made it
obvious that its violation resulted in a continuing offence.
The true principle appears to be that where the wrong
complained of is the omission to perform a positive duty
requiring a person to do a certain act the test to determine
whether such a wrong is a continuing one is whether the duty
in question is one which requires him to continue to do that
act. Breach of a covenant to keep the premises in good
repair, breach of a continuing guarantee, obstruction to a
right of the way, obstruction to the right of a person to
the unobstructed flow of water, refusal by a man to maintain
his wife and children whom he ii bound to maintain under law
and the carrying on of mining operations or the running of a
factory without complying with the measures intended for the
safety and well-being of workmen may be illustrations of
continuing breaches or wrongs giving rise to civil or
criminal liability. as the case my be, de die in diem.
In Balkrishna Savalram Pujari & Ors. v. Shree
Dayaneshwar Maharaj Sansthan & Ors. Gajendragadkar, J. (as
he then was) observed:
"It is the very essence of a continuing wrong that
it is an act which creates a continuing source of
injury and renders the doer of the act responsible and
liable for the continuance of the said injury. If the
wrongful act causes an injury which is complete, there
is no continuing wrong even though the damage resulting
from the act may continue. If, however, a wrongful act
is of such a character that the injury caused by it
itself continue, then the act constitutes a continuing
wrong. In this connection it is necessary to draw a
distinction between the injury caused by the wrongful
act and what may be described at the effect of the said
injury."
Section 18 of the Act with which we are concerned in
this case, however, does not require the assessee to file a
return during every month after the last day to file it is
over. Non-performance of any of the acts mentioned in
section 18(1)(a) of Act gives rise to a single default and
to a single penalty, the measure of which,
434
however, is geared up to the time lag between the last date
on which the return has to be fled and the date on which it
is filed. The default, if any committed is committed on the
last date allowed to file the return. The default cannot be
one committed every month thereafter. The words for every
month during which the default continued’ indicate only the
multiplier to be adopted in determining the quantum of
penalty and do not have the effect of making the default in
question a continuing one. Nor do they make the amended
provisions modifying the penalty applicable to earlier
defaults in the absence of necessary provisions in the
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amending Acts. The principle underlying section 6 of the
General Clauses Act is clearly applicable to these cases. It
may be stated here that the majority of the High Courts in
India have also taken the same view.
In the result we hold that where the default complained
of is one falling under section(l)(a) of the Act, the
penalty has to be computed in accordance with the law in
force on the last day on which the return in question had to
be filed. Neither the amendment made in 1964 nor the
amendment made in 1969 has retrospective effect.
The appeals therefore fail and are dismissed with
costs. Hearing fee one set.
S.R. Appeals dismissed.
435