TaxTMI 
TaxTMI 
1990 (5) TMI 60
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....teel Rolling Mills. 2. That the ld. CIT(A) was not justified to uphold the action of the ld. Assessing Officer by observing that not withstanding the fact that the income had been disclosed stating that such disclosed income was from ' Industrial undertaking', the appellant was further under a legal obligation to link the disclosed income under the Amnesty Scheme with the industrial undertaking for the purpose of ss. 80HH and 80-I ignoring the spirit and scope of the Scheme as elucidated and clarified by the senior officers of the Board. In any case, rejection of the claim of deductions of Rs. 11,32,391 each under ss. 80HH and 80-I in the facts and circumstances of the case, was unwarranted and unjustified keeping in view the scope and sp....
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....cer, for the assessee that no such expenditure out of books had been incurred. The Assessing Officer, therefore, came to the conclusion that the income disclosed under the Amnest Scheme was not derived from the industrial under taking, and, therefore, deductions under ss. 80HH and 80-I could not be allowed. The submission of the assessee before the Assessing Officer was that the Department was prohibited from making any enquiry regarding the source of income, The Assessing Officer has observed: "....I do agree that under the Amnesty Scheme the Department is prohibited from enquiring into the source of income." He further observed: "...the attempt of the assessee appears to be to disclose the higher income by paying the tax only at 60 ....
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....rates. The clarification sought from the Chief Commissioner was whether in cases where the assessee firm or company declares stock under the Voluntary Disclosure Scheme and took it into profits for a particular year, whether the firm/company was entitled to benefits under ss. 80J, 80H, 80HH,80HHA, 80-I, etc. On the disclosed income. The answer was under: "Yes, such assessee making declarations are entitled to get benefits under these exemption provisions provided under the law." Sh. Mohan Lal, referring to this clarification by the Chief Commissioner, pointed out that the declaration of stock would not necessarily mean that it represented the business income. The investment in such stock could be as income from undisclosed sources and n....
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....closed under the Amnesty Scheme has to be accepted as derived from the industrial undertaking, and, therefore, entitled to deductions under ss. 80HH and 80-I. He also referred to a circular contained in D.O. No. 281/50-86-IT(Inv. III),dt. 17th June, 1986 from Sh. S.K. Roy, Member (Investigation), CBDT. In particular, he referred to para 3 of the said circular, stating that the matter was considered in a meeting of the Board, which was strongly of the view that if such voluntary returns were made the basis of roving enquires to find out the date of acquisition of the wealth and substantive assessments are made for years other than the year in which the income has been disclosed without the ITO having any material on record, it would be absol....
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....n the parties that the Department is precluded from making any enquiry about the source and nature of income voluntarily disclosed under the Amnesty Scheme. It is a different matter, if the Department could prove, on the basis of material available with it, that the income disclosed by the assessee is not derived from the industrial undertaking but from some different source. No such material has been brought on record the Revenue. We are in agreement with the learned counsel for the assessee that even the stock declared could not be straightway accepted as the concealed stock of the industrial undertaking. Such stock could be purchased from the funds available from other sources but disclosed under the Amnesty Scheme as stock of the indust....