2003 (9) TMI 30 - HC - Income Tax

Voluntarily disclosed income - plaintiffs while cross-examining defendant No.1 called upon him to produce a letter dated December 31, 1975 purportedly addressed by the witness to the Commissioner of Income-tax. Mr. Shah learned counsel appearing on behalf of defendant No. 1 objected even to the production of the document on the ground that the same was barred under section 12 of the Voluntary Disclosure of Income and Wealth Act 1976 - document that the witness is called upon to produce is a covering letter in respect of the disclosure made by the witness under the Voluntary Disclosure Scheme of 1975. The letter refers to certain facts and attached thereto is the statement of income assessed income to be disclosed total tax due tax paid and a token for balance of tax paid for the years 1967-68 to 1974-75 Held that production of the letter would not defeat the provisions of the Scheme being barred u/s 12 of the Voluntary Disclosure of Income and Wealth Act 1976

Summary

Issues:
1. Objection to the production of a letter dated December 31, 1975, under the Voluntary Disclosure of Income and Wealth Act, 1976.
2. Interpretation of relevant provisions of the 1976 Act regarding the confidentiality and production of declarations.
3. Determining whether the letter dated December 31, 1975, constitutes a declaration under the 1976 Act.
4. Analysis of the contents of the letter to establish if it contains a declaration and if certain parts can be compelled to be produced.

Issue 1:
The judgment revolves around the objection raised against producing a letter dated December 31, 1975, under the Voluntary Disclosure of Income and Wealth Act, 1976. The objection was based on the confidentiality provisions of the Act, specifically section 12, which prohibits the production of declarations or any part thereof in court proceedings.

Issue 2:
The court analyzed the relevant provisions of the 1976 Act, emphasizing the confidentiality aspect outlined in section 12. The Act safeguards the confidentiality of declarations made under the scheme, prohibiting their production or requiring evidence related to them before any authority or court.

Issue 3:
The court delved into whether the letter dated December 31, 1975, qualifies as a declaration under the 1976 Act. It was concluded that the letter itself did not constitute a declaration, but the attached details, such as the disclosure made under the Voluntary Disclosure Scheme, were considered declarations and protected under section 12.

Issue 4:
The judgment scrutinized the contents of the letter to determine if it contained a declaration or parts that could be compelled to be produced. The court differentiated between the parts of the letter that constituted declarations, like the disclosure details, and other parts, such as personal admissions, which could be required to be produced for evidence.

In conclusion, the court overruled the objection to producing the letter but specified that only the letter itself, without the annexure and attachments containing declaration details, should be produced. The judgment clarified the distinction between parts of the letter that constitute declarations, protected under the Act, and other non-declaration-related information that could be compelled for production.