1987 (4) TMI 13 - HC - Income Tax

Summary

Issues:
- Interpretation of Explanation 2 to section 273A of the Income-tax Act, 1961.
- Whether the petitioner made a full and true disclosure of income within the specified time limit.
- Permissibility of making a subsequent disclosure petition as a continuation of the first petition.
- Commissioner's authority to extend the time for disclosure under the Act.

Interpretation of Explanation 2 to section 273A:
The petitioner filed a writ petition challenging the Commissioner's order rejecting the prayer for waiver of penalties and interest under the Income-tax Act. The Commissioner held that the petitioner did not make a full and true disclosure of income within 15 days of seizure, as required by Explanation 2 to section 273A. The court analyzed the text of Explanation 2, emphasizing the essential requirements for availing the benefit: a full and true disclosure of income within 15 days of seizure. The court clarified that without meeting these requirements, the benefit under Explanation 2 cannot be claimed. It was highlighted that the determination of full and true disclosure is a factual question.

Disclosure of Income and Time Limit Compliance:
The Commissioner found that the petitioner's disclosure on February 23, 1985, was not a full and true disclosure, as evidenced by a subsequent disclosure on January 20, 1986, offering an additional amount. The court noted that the second disclosure was made beyond the 15-day limit and without the required completeness. The court emphasized that the Act does not provide for extending the time for disclosure or considering subsequent petitions as continuations of the initial disclosure. It reiterated the strict construction of fiscal statutes and concluded that the Commissioner had no authority to extend the time limit.

Commissioner's Findings and Discretion:
The Commissioner determined that the additional disclosure made by the petitioner was not voluntary but due to compulsive circumstances. The court upheld the Commissioner's findings, stating that there was no manifest error of law in the order. It emphasized that the Commissioner's decision was based on factual assessments regarding the disclosure of income and the timing of submissions. Consequently, the writ petition was dismissed.

This detailed analysis of the judgment highlights the court's interpretation of the statutory provisions, the petitioner's compliance with disclosure requirements, and the Commissioner's discretionary powers in assessing such matters under the Income-tax Act.