TMI Blog1998 (2) TMI 32X X X X Extracts X X X X X X X X Extracts X X X X ..... il, 1976. The ITO made an addition of a sum of Rs. 50,000 to the total income returned by the assessee on the ground that the assessee had not satisfactorily explained the nature and source of credit entry of Rs. 50,000 found in the books of accounts dt. 29th Dec., 1975. The assessee had made a voluntary disclosure of Rs. 50,000 under the provisions of the Voluntary Disclosure of Income and Wealth Act, 1976 (hereinafter referred to as 'Voluntary Disclosure Act'). The assessee made the declaration under the Voluntary Disclosure Act as under : Income (Rs.) 1968-69 10,000 1969-70 10,000 1970-71 10,000 1971-72 10,000 1972-73 10,000 The assessee signed the necessary declaration form under the Voluntary Disclosure Act on 29th Dec., 1975, and remitted the tax of Rs. 16,250 on the same day. The assessee also despatched the papers by post to the CIT on 31st Dec., 1975, but the papers were received by the office of the CIT only after 1st Jan., 1976, and as the matter was late, the Department h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal pursued the assessment files for the earlier years and found that the sum of Rs. 50,000 probably cannot be an income for the asst. yr. 1976-77 on the score that the assessment records for the asst. yrs. 1964-65 to 1975-76 give an impression that there might be a possibility of some income escaping assessment in those assessment years. The Tribunal therefore, held that the assessee had explained the nature and source of the credit entry and deleted the addition made by the ITO and allowed the appeal preferred by the assessee. 5. Mr. C.V. Rajan, learned counsel for the Revenue, submitted that the view of the Tribunal is erroneous in law and the assessee's explanation that it was a concealed income of the earlier years cannot be regarded as a valid and satisfactory explanation, He submitted that under provisions of s. 68 of the Act, the onus is on the assessee to prove satisfactorily the source of the credit entry and there is no material or evidence to show that the credit entry relates to the concealed income of earlier years. He also submitted that since the declaration was not accepted by the Department, the declaration cannot be looked into for any purpose and the statem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee from the undisclosed sources. In CIT vs. Durga Prasad More (1969) 72 ITR 807 (SC) : TC 42R. 1314, the Supreme Court held that once it was found that a receipt by the assessee was income of the assessee it is not necessary for the Revenue to locate its exact source of the credit and the said principle will apply also to the cases where entries are made in the books of accounts. 8. In Kale Khan Mohamed Hanif vs. CIT (1963) 50 ITR 1 (SC) : TC 42R. 1019 the Supreme Court held that the onus is on the assessee to prove the nature and source of the credit entry found in the account books of the assessee, In CIT vs. Orissa Steel Corporation (P) Ltd. (1982) 31 CTR (Cal) 160 : (1983) 144 ITR 662 (Cal) : TC 42R. 1107, the Calcutta High Court held that where cash credits and other sums were credited in the books of accounts of the assessee, the assessee has to satisfactorily explain the source of credit, otherwise the said sums would come within the purview of s. 68 of the Act and would be assessable as the income of the assessee. In CIT vs. Orissa Corporation (P) Ltd. (1986) 52 CTR (SC) 138 : (1986) 159 ITR 78 (SC) : TC 42R.1098, the Supreme Court held as under : "Under the 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o go behind the statement of facts made by the Tribunal in its appellate order. The Supreme Court also held that the Court may go so only if there is no evidence to support the findings of the Tribunal or the Tribunal has misdirected itself in law in arriving at the findings of fact. In S.R. Venkata Ratnam vs. CIT (1981) 127 ITR 807 (Kar) : TC 42R.1568, the Karnataka High Court held that once the assessee disclosed the source of credit, the ITO, has only two options; one is, he can reject the explanation given by the assessee, and another is, he can call upon the assessee to substantiate his claim by documentary evidence and on the basis of mere surmises, it is not open to the ITO to make an addition. 11. The principle of law is well settled and there is no dispute that the Tribunal is the final fact-finding authority and this Court has no jurisdiction to disturb the finding of fact arrived at by the Tribunal, if the finding is based on certain materials on record. The questions referred to us have to be considered in the light of the provisions of s. 68 of the IT Act which reads as under : "Sec. 68 --- Where any sum is found credited in the books of an assessee maintained fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rnment that the immunity will be offered, the assessee has made the statement. It is, no doubt, true that the Government made a promise that if the assessee voluntarily discloses the income subject to certain conditions, the immunity will be granted, but when the assessee had not fulfilled the terms under which the disclosure was expected to be made, it is not open to him to complain that he would not have made the statement, but for the inducement offered by the Government and therefore, it is impermissible to rely upon the statement made in the Voluntary Disclosure Scheme. Even assuming that the statement made therein is regarded as a piece of evidence the assessee must be able to prove the statement made by him in the disclosure scheme is corroborated by some independent materials as the assessee has come under the regular assessment channel and it is for him to satisfy the authorities that the onus placed on him under s. 68 of the Act is discharged. 13. The second reasoning given by the Tribunal is also based on probabilities of the case. The view of the Tribunal that the assessee could not have earned Rs. 50,000 in one year is not based on any material and further the reason ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... away during intervening period. It is not clear from the order of the Tribunal how the Tribunal came to the conclusion on the perusal of the earlier assessment records that the assessee might have earned the sum which was not disclosed in the earlier assessment proceedings. In our view, the conclusion of the Tribunal is arrived at only on the basis of its own summarises and conjectures and there is a complete dearth of materials for its conclusion and, in our opinion, it has by cosmeticising its (sic) has given an illusion that it has arrived at a findings of fact, on the basis of the materials, and the ultimate inference drawn on the basis of the above reasonings, in our view, is not sustainable on the facts of the case. The ITO as well as the CIT(A) has clearly found that the assessee had not explained the source of the credit entry and the assessee had not let in any new evidence before the Tribunal and only on the basis of the plea raised before the Tribunal that the said amount could have been the undisclosed income of earlier years and it would not represent the income of the previous year and also on the basis of the belated disclosure made by the assessee under the Volunta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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