TaxTMI 
TaxTMI 
1984 (5) TMI 41
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.... of the disallowance of interest of Rs. 5,804 for the assessment year 1967-68, Rs. 9,958 for the assessment year 1968-69 and Rs. 602 in the assessment year 1969-70 ?" There are three income-tax references but as there is only one question, this judgment will dispose of all the three references. The facts of the case are that in the assessment proceedings for the year 1967-68, cash deposits standing in the names of Shrimathi Durga Devi, Shrimathi Parveen Kanta, Shrimathi Suraj Kanta, Shrimathi Trishla Devi and Shrimathi Suresh Rani, which were Rs. 10,000 each, were noticed by the ITO and these were unexplained credits. He, accordingly, included the sum of Rs. 50,000 in the assessment year 1967-68 and disallowed the interest of Rs. 5,803.97....
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....ly, the matter before us is not as simple as this. The question which was referred in the case before the Supreme Court was: " Whether, on the facts and in the circumstances of the case, and the declarations made by Shailendra Kumar, Satish Kumar, Sunil Kumar, Swatantra Kumar and Santosh Kumar under the Finance (No. 2) Act of 1965, and accepted as such by the Commissioner, there is justification in law in holding that the sums amounting to Rs. 46,250 credited to their accounts existing in the books of the applicant-firm was income of the applicant-firm from undisclosed sources ? The question referred to us is in quite a different form. The facts in the present case are also different from those of the case before the Supreme Court. It is....
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....essee in the declarations made on solemn affirmation by the ladies were accepted by the Commissioner without requiring them at that time to reveal the exact sources. In these circumstances, the explanation furnished by the assessee was accepted as satisfactory. The appellant has also urged that the ladies were absolute owners of the credits. In support of this contention, it has produced copies of accounts of the ladies for the subsequent years showing some of the amounts utilised by them as under..." Thereafter details were shown that the sums of Rs. 14,954 in the case of two ladies, Rs. 12,500 in the case of another lady and Rs. 22,500 and Rs. 12,502 in the case of the last two ladies, had been invested by them either for the purchase of....
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....e AAC were reproduced, but the decision was based entirely on Rattan Lal's case [1975] 98 ITR 681 (Delhi), which by itself is not sufficient to hold that the deposits were from undisclosed sources. To explain this point of view, it is necessary to say that the declarations made under the Voluntary Discloure Scheme are a piece of evidence. The Delhi High Court in Rattan Lal's case [1975] 98 ITR 681, had held that the declarations were conclusive. But, this view has been overruled as being incorrect by the Supreme Court. This does not mean that the opposite view-point, namely, that the declarations are false, has to be adopted. A declaration can either be true or it can be false. It depends on the facts of each case as to whether the amount ....
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....e declaration was conclusive but on the basis that it was a piece of evidence showing that these ladies had the money and had made solemn declarations about the same. There was also the circumstance that the declarations were made in March, 1966, whereas the money came to the firm in August, 1966. There is a further circumstance which could arise in this case If the amount was a benami amount for argument's sake, then it could be a benami amount of the husbands of the five ladies and not of the assessee firm. As these are all questions of fact which had to be determined one way or the other, it is difficult to say that the question referred to us can be answered merely on the ground that Rattan Lal's case [1975] 98 ITR 681 (Delhi), has bee....