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TMI Blog1982 (5) TMI 114X X X X Extracts X X X X X X X X Extracts X X X X ..... nducted in the premises of the assessee on 11th November 1975. The reasoning for reopening the aforesaid assessments seemed to be the information he got from a petition moved by the assessee u/s 271 (4A) of the IT Act, 1961, before the CIT, MP-1 and a similar petition before the Chairman, CBDT, on 16th Feb 1970 offering an amount of Rs. 3 lacs to be taxed stating therein as under: "In order to avoid lengthy and protracted proceedings and to buy peace, I offer the aforesaid amount of Rs. 3 lacs for assessment in the past seven years namely asst. yrs. 1958-59 to 1964-65. The present offer is made for settlement of the taxation of Rs. 3 lacs at the hands of the applicant in his individual capacity, with a view to settle the matter, although this cause entails greater tax liability for the appellant." On the basis of the above petition and the facts emerging from the IT file of the assessee, and the firm in which he was a partner, the WTO made the addition in all the aforesaid assessment years to the original wealth assessed. Here, it may also be mentioned that the assessee who is a partner in the firm M/s Associated Agencies, Bhopal, constituted on 1st August 1958 carried on the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said order of the Tribunal, it has been pleaded that large number of cash credits appearing in the books of accounts of the assessee had been directed to be treated as genuine. Only the cash credits in the names of the above three persons, who had denied having given any genuine loans to the assessee could be added on the basis of the income-tax case, to the wealth of the assessee. After considering the earlier order of the Tribunal, as mentioned above, the AAC directed the WTO to add to the wealth of the assessee only those cash credits and hundi loans which had been denied by the alleged creditors. 3. Apart from the addition of Rs. 3 lacs made by the WTO to the wealth of the assessee in the years in question, he has included a sum of Rs. 50,000 in the wealth of the assessee from the asst. yr. 1965-66 onwards. The reasons for the above addition seems to be that in the course of the search and seizure operation on 11th November 1958, ten blank hundi forms of denomination of Rs. 55,000 each signed by Shri Brijlal Vissanji, were found in the wordrobe of the assessee. The WTO in his order pointed out that the ITO, A-Ward, Bhopal u/s 132 (5), dt. 5th February 1976 had held that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... At the outset drew our attention to s. 21 of the Evidence Act, where in it is laid down that admission are relevant and may be proved against the person who makes them for his representative in interest. He, therefore, argued that the statement contained in the petition filed by the assessee before the CIT, and a similar petition filed by the assessee before the CBDT, namely offering an amount of Rs. 3 lacs for the assessment in the past seven years, namely 1958-59 to 1964-65, amounts to an admission and in view of s. 21 of the Evidence Act, the aforesaid admission of the assessee can be proved against him, In brief, he wanted to say that the statement in the aforesaid petitions being an admission, the WTO has rightly reopened the assessment u/s 17 (1) (a) of the WT Act. The ld. Deptl. Rep. further contended that the action of the WTO u/s17 (1) (a) is justified in making the addition of Rs. 3 lacs made by the WTO to the net wealth of the assessee. With regard to the addition of Rs. 50,000 to the wealth of the assessee, the ld. Deptal. Rep. Further contended before us that the ITO in the income-tax proceedings had given a definite finding that the assessee had advanced Rs. 50,000 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the WT Act. If we read the statement carefully we find that it is only an offer made for the amount of Rs. 3 lacs made by the assessee for the asst. yrs. 1958-59 to 1964-65. If we read the later part of the statement, it is evident that he has made the aforesaid offer with a view to settle the matters although this caused greater liabilities for the assessee. It is an admitted fact that the aforesaid offer has not been accepted by the department and instead that offer constituted information to the WTO to initiate proceedings u/s 17 (1) (a). By not accepting the offer and at the same time taxing the assessee for the amount offered by him, the revenue has tried to blow hot and cold at one and the same time which, in our opinion, is not just. The offer having not been accepted by the revenue cannot be basis for reopening the assessment by the WTO u/s 17 (1) (a) of the WT Act. Even though we have not been asked to adjudicate this point, we are just expressing our opinion that the addition of Rs. 3 lacs made to the wealth-tax of the assessee on the basis of the offer made by the assessee is not proper as at the time of reopening the assessment it is deemed as no offer has been made by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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