Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2013 (2) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (2) TMI 270 - HC - Income TaxVoluntary Disclosure of Income Scheme, 1997 - appellant disclosed its stock, cash etc. of the years 1994-95, 1995-96 and also of the year 1996-97 - whether, because of disclosure of stock on 26th December, 1997 pertaining to the years 1994-95 and 1995-96 as well as cash and amount of sundry debtors, they shall continue to be good for the year 1997-98? - whether the appellant was entitled to the benefit of increase in the stock, cash and the amount of sundry debtors of previous years due to disclosure of undisclosed stock, cash and the amount of sundry debtors of previous years - Held that:- Presumption of existence of the stock, cash and the amount of sundry debtors can be taken at least for the years under consideration, which are only 3 years and therefore, the Revenue under wrong impression that the assessee is claiming the benefit of VDIS for the year 1997-98, proceeded to reject the appellant’s claim of increase in stock, cash and the amount of sundry debtors for the relevant years, ignoring the fact that such undisclosed assets’ extinction has not been proved, nor any effort has been made by the AO to find out whether those stock, cash and the amount of sundry debtors have been sold or utilized and increase of stock, cash and the amount of sundry debtors because of increase in the stock, cash and the amount of sundry debtors due to voluntary disclosure of the appellant under the Scheme of 1997, was not continuing in the hands of the assessee. Therefore, stock, cash and the amount of sundry debtors, on account of disclosure of the appellant on 26th December, 1997, pertaining to the closing date of 31st March, 1996 and pertaining to previous year 1995-96 and assessment year 1996-97 be the opening balance as on 1st April, 1996 and effect of increase in the stock, cash and the amount of sundry debtors due to increase of the previous years’ increase in stock, cash and the amount of sundry debtors is required to be given. AO even after rejecting the books of accounts of the assessee for the purpose of declaring opening stock of the assessee, relied upon the same statement of accounts and books of accounts produced by the assessee and without enquiry, declared that the assessee sold out undisclosed stock of the earlier years in those years itself. The Tribunal in impugned order even went to the extent of declaring that disclosure made was not voluntary but it was a compulsion on the part of the applicant to opt for VDIS as it was caught by the Department with unaccounted income at the time of survey under section 133A on 26th December, 1997. The Tribunal failed to understand the VDIS, which nowhere says and nowhere prohibits any person from disclosing his income, who is under fear of being caught. The Scheme gives benefit upon disclosure of income provided that his disclosure is in accordance with the Scheme of disclosure and once a disclosure is accepted by the Revenue, then it cannot be questioned in subsequent proceedings by holding that the disclosure was not voluntary. Once the Scheme permits disclosure of previous years stock, cash and the amount of sundry debtors and there may be presumption of continuation of holding stock, cash and the amount of sundry debtors for a reasonable period in the light of the judgment of J.K. Cotton Manufacturers Ltd. (1994 (2) TMI 3 - SUPREME COURT), then the assessee is entitled to take the benefit of increase in stock, cash and the amount of sundry debtors and consequence thereof - Tribunal also failed to appreciate the Circular Nos.754 and 755 issued by the CBDT - in favour of the assessee
|