9911796707
TMI Blog1991 (1) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... admissible deduction in computing the net wealth of the assessee for the assessment years 1968-69 to 1970-71 ?" Shortly stated, the facts are that the Wealth-tax Officer reopened the assessments for the said years finalised earlier as a sequel to the disclosure of income and wealth made by the assessee under the concerned Ordinance, 1975, as a result of a search conducted by the Department. The concealed wealth disclosed by the assessee was added back by the Wealth-tax Officer but he did not allow the income-tax and wealth-tax liabilities arising out of such disclosure for these years as the liability was not admitted by the assessee earlier and it arose only in 1975. On appeal to the Appellate Assistant Commissioner, he allowed the cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, it is clear that the disclosure envisaged under section 68 is in respect of an amount which is already liable to be assessed as income under the relevant Income-tax Act. The condition precedent to disclosure under the said section is that the said amount has not been so assessed in the regular course for some reason or other. This decision was approved by the Supreme Court in the case of Ahmed Ibrahim Sahigra Dhoraji v. CWT [1981] 129 ITR 314. There, the Supreme Court, after considering the decisions of different High Courts and after considering the provision of the Finance Act regarding the Voluntary Disclosure Scheme, came to the conclusion that the true position is that the amount declared under section 68 of the Finance Act, 196 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... et-offs under the relevant income-tax law. Yet its function was no more than that of a Finance Act passed annually even though it made certain alterations with regard to filing of declarations and computation of taxable income. That the declaration was dependent upon the volition of the declarant and that the liability to tax on the amount mentioned therein was contingent upon the willingness of the declarant to disclose the amount make no difference. Any such voluntary disclosure by an assessee, even in the absence of section 68, would have exposed him to an assessment or reassessment, as the case may be, being made in respect of the sum disclosed as part of the income of the relevant assessment year and with the additional liability to pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 68. Even though it may appear to be by itself a complete code, it is only a scheme which provides a method for the liquidation of an already existing income-tax liability which was present on the relevant valuation date". Our attention has also been drawn to the decision of the Kerala High Court in the case of CWT v. K. Ravindranathan Nair [1989] 177 ITR 1, where this question under the Voluntary Disclosure of Income and Wealth Act, 1976, came up for consideration. There, the Kerala High Court, considering the decision of the Supreme Court in Ahmed Ibrahim Sahigra Bhoraji [1981] 129 ITR 314, held that the liability to pay income-tax on concealed income disclosed under the Voluntary Disclosure Scheme is deductible as a "debt owed" on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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