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TMI BlogClarification regarding the Press note and circulars issued by the Ministry of Finance regarding declaration of higher income or wealthX X X X Extracts X X X X X X X X Extracts X X X X ..... of the amounts of income and/or wealth concealed in various years and should also file returns for the relevant years. He should also produce evidence of payment of taxes before March 31, 1986. The filling of the returns will be regularised by issue of formal notices under section 148 of the Income-tax Act/section 17 of the Wealth-tax Act. In cases where the assessments are pending, the taxpayer should file revised return before the Income-tax Officer along with evidence of payment of taxes. Question No.2 .-In respect of completed assessments, the question will arise whether the assessee should merely declare the income relevant to those years and pay the tax according to the rates prevalent in those years on such declared income or whether he is required to file the return of income showing the additional income? Answer.- As mentioned above, he must file a fresh return of income including the additional income. Question No. 3.- Reading Circular No. 423 together with Circular No. 441, it is not clear whether the old assessees who have been regularly filling their returns of income would be eligible for the benefit of the circulars in respect of their income which has esca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , whether the Wealth-tax Officer will require the assessee to prove the source from which the item of wealth was acquired? Answer.- It should be obvious that the wealth-tax return for 1986-87 can be filed only after the period of immunity, namely, March 31, 1986, is over. therefore, there can be no question of not being asked to explain the source of acquisition of asset in such a case. Question No.10.- The wealth-tax returns for 1986-87 will be due only in June/July, 1986, but the immunity granted by the circular is only up to 31st March, 1986. It may kindly be explained how the immunity can apply for the wealth-tax assessment for the year 1986-87? Answer.- The answer is simple. Where the wealth-tax payer discloses the correct wealth in the return for 1986-87, he does not require any immunity. The intention of the circular is that the correct not wealth in the return for the assessment year 1985-86, and earlier years should be disclosed and the immunity availed of Question No.11.- Whether ladies and minors can avail of the immunity given by the circulars? Answer.- Yes. In respect of their own income or wealth certainly. But taxpayers who try to introduce blackmoney ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the source of acquisition cannot be satisfactorily explained? Answer.- Of course, the taxpayer should not expect that he can evade income-tax and pay only wealth-tax. The return to honesty must be wholehearted and not partial. Question No. 19.- Kindly clarify the expression "before detection by the department"? Answer.- If the Income-tax Officer has already found material to show that there has been concealment, that would mean the Department has detected the concealment. If the Income-tax Officer only had prima facie belief, that would not mean concealment has been detected. Question No.20 .-Whether partners could declare in their wealth-tax returns their share in the stock-in-trade? Answer.- Yes, they can. Question No.21 .-Whether such a declaration by the partners could be taken as information by the Income-tax Officer for initiating proceedings under section 147(a)/(b) against the firm? Answer.- Yes, unless they also choose to disclose the income of the firm. As pointed out earlier, their desire to turn honest must be full and not partial. Question No.22.- If during the previous year relevant to the assessment year 1986-87, an assessee has acquired asset ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... surrender cannot be taken as a suo motu declaration but naturally a lenient view will be taken if an assessee decides to turn honest even at this stage. Question No.27 .-Whether an assessee could take advantage of the circular and file an estimate of advance tax after December 15, 1985? Answer .-Yes. Question No.28 .-Where an addition is contested in appeal, whether an assessee could make a declaration and agree to pay tax thereon? Answer.- Yes, the assessee should withdraw that appeal and make a declaration before the administrative Commissioner. In such a case, a lenient view will be taken, though such a declaration cannot be taken as entirely voluentary. Question No. 29 .-Whether if a partner now declares income which he had not done earlier, and other partners have not, the cases of those partners of the firm would be reopened? Answer.- Yes, if the income declared is share income. Question No.30.- Whether an assessee could make a declaration in respect of assets or income which is not the subject-matter of seizure? Answer.- Yes, if it has not been already found out in the course of the search. Question No. 31.- If an assessee has declared income, wou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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