1982 (4) TMI 107 - AT - Wealth-tax

Summary

Issues:
1. Validity of assessments made by the WTO for the assessment years 1970-71 to 1975-76.
2. Bar on assessments due to limitation.
3. Validity of the assessee's disclosure under the Voluntary Disclosure of Income & Wealth Ordinance.

Analysis:

Issue 1: Validity of Assessments
The department issued notices under sections 17 and 14(2) for the assessment years 1970-71 to 1975-76. The Senior Deptl. Rep. argued that the assessments were not barred by limitation as the notices were served within the prescribed time frame. The AAC accepted the assessee's argument that the assessments were illegal due to the disclosure made under the Voluntary Disclosure of Income & Wealth Ordinance. The assessee contended that the assessments were not justified as disclosures were made for all relevant years. The Senior Deptl. Rep. argued that the assessee's declarations were not valid as notices were issued before the commencement of the Act. The AAC maintained that once valid disclosures were made, separate assessments could not be conducted. The Tribunal concluded that assessments made based on notices issued after the returns were already on record were not valid.

Issue 2: Bar on Assessments due to Limitation
The AAC canceled the assessments for the years 1970-71 to 1975-76, citing that they were barred by limitation. The department contended that the assessments were not time-barred as notices were issued within the statutory period. The Tribunal analyzed the timing of the notices and concluded that assessments based on notices issued after the returns were already filed could not be sustained.

Issue 3: Validity of Assessee's Disclosure
The assessee made disclosures for the assessment years 1967-68 to 1975-76 under the Voluntary Disclosure of Income & Wealth Ordinance. The AAC accepted the disclosures, leading to the cancellation of assessments. The Tribunal upheld the AAC's decision, stating that once valid disclosures were made, the same wealth could not be separately assessed for taxation. The Tribunal maintained that assessments based on disclosures made under the Ordinance could not be upheld separately under the Wealth Tax Act.

In conclusion, the Tribunal dismissed the departmental appeals, upholding the cancellations of assessments by the AAC based on the validity of the assessee's disclosures and the limitation on assessments.