R.N. Pyne, J.
1. In this reference under Section 27(1) of the W.T. Act, 1957, we are concerned with the assessment years 1958-59, 1959-60, 1960-61, 1961-62, 1962-63 and 1963-64, respectively.
2. Relevant facts of this case as stated by the Income-tax Appellate Tribunal in the statement 6f case submitted to the court may briefly be stated.
3. The assessee was assessed to wealth-tax for the six assessment years mentioned above and the corresponding valuation dates were 31-12-57, 31-12-58, 31-12-59, 31-12-60, 31-12-61 and 31-12-1962. The assessee was originally assessed for the aforesaid assessment years, but subsequently, it was found out by the WTO from the relevant assessment records pertaining to income-tax, that a letter from the assessee dated 25th March, 1965, addressed to the ITO, 'E' Ward, District III(1), who was the assessing-ITO of the assessee, informed him (the ITO) that the assessee had made a disclosure of Rs, 2,28,000 under the Voluntary Disclosure Scheme under Section 68 of the Finance Act, 1965, and paid tax of Rs. 1,69,800 on 25th March, 1965. The said ITO was also informed that the balance amount of Rs. 1,28,140 was taken into the assessee's accounts. A copy Of the assessee's letter dated 15th March, 1965, addressed to the Commissioner of Income-tax was enclosed with the said letter dated 25th March, 1965. On the basis of that information the WTO issued notices under Section 17 of the W.T. Act, 1957, for the said six assessment years and in response to such notices the assessee filed returns of net wealth on 5th January, 1966, under protest. Before the WTO, the assessee contended that the asset by way of income disclosed under Section 68 of the Finance Act, 1965, was not taxable under the W.T. Act. That contention was, however, rejected bythe WTO. The WTO also rejected the assessee's claim for a deduction ofthe income-tax paid under Section 68 as above. We are, however, not concernedwith this aspect of the matter in the instant reference.
4. Being aggrieved by the order of the WTO, the assessee preferred appeals before the AAC challenging the legality of the initiation of proceedings under Section 17 of the W.T. Act, on the ground, inter alia, that Section 68 of the Finance Act, 1965, granted immunity from the levy of wealth-tax in respect of the amounts voluntarily disclosed. It was further contended that under Section 68(8)(b) of the Finance Act, 1965, particulars of the disclosure petition was to be treated as confidential and could be disclosed only to the officer employed in the execution of the acts mentioned in Section 68(5) of that Act, which did not include the WTO. The AAC, however, rejected the assessee's contention. According to him, by virtue of Section 8 of the W.T. Act, the same officer was handling the assessee's case for the purposes of assessments, both under the I.T. Act as well as the W.T. Act, and, accordingly, the assessee's letter dated 25th March, 1965, and his disclosure petition constituted information enabling the WTO in initiating proceedings under Section 17 of the W.T. Act. The AAC was also of the opinion that Section 68 of the Finance Act, '1965, did not contain any provision debarring the taxing authority from assessing the disclosed income to the wealth-tax.
5. Being aggrieved by the order of the AAC, the assessee preferred appeals therefrom to the Income-tax Appellate Tribunal. Before the Tribunal referring to Section 68 of the Finance Act, 1965, and Section 24 of the Finance (No. 2) Act, 1965, it was contended, on behalf of the assessee, that a greater degree of sanctity had been attached to the provisions of Section 68 of the Finance Act, 1965, than to those of Section 24 of the Finance (No. 2) Act, 1965. It was also argued that that being the position, when Section 24(ii) of the Finance (No. 2) Act, 1965, prohibited the admissibility ; as evidence, of the disclosure made under Section 24 of the said Act even for the purpose of assessment under the W.T. Act, Section 68 of the Finance Act, 1-965, though not containing any such restrictive clause, should be interpreted as containing restrictions similar to those under Section 24(ii) of the Finance (No. 2) Act, 1965. It was further contended before the Tribunal that though the same officer had been wielding powers as the ITO and the WTO, the provisions of Section 68 did not empower the ITO to pass on the particulars of the disclosure made under Section 68 of the Finance Act, 1965, from the income-tax file to the wealth-tax file.
6. On behalf of the revenue, it was submitted before the Tribunal that the secrecy provisions in Section 68 did not constitute any bar for the WTO against utilising the information available in the income-tax records. Referring to Section 68 of the Finance Act, 1965, and Section 24 of the Finance (No. 2)Act, 1965, it was contended, on behalf of the revenue, that an interpretation of the former section on the lines of the latter section was incorrect because there was no specific provision in Section 68 as that contained in the latter Act, i. e., Section 24 of the Finance (No. 2) Act, 1965.
7. The Tribunal considered the rival submissions of the parties and was of the view that the initiation of the proceedings under Section 17 of the W.T. Act was valid. According to the Tribunal, Section 68(8) does not prevent the WTO from utilising the information received by him as an ITO from the assessee in taking action under Section 17 of the W.T. Act. It was further held by the Tribunal, that the restriction imposed by Section 68(6)(a) of the Finance Act was imposed only with reference to the income-tax assessment and the wealth-tax assessment being an asset, the said section had no application in the instant case. The Tribunal, therefore, upheld the initiation of proceedings under Section 17 of the W.T. Act.
8. The assessee, thereafter, made a reference application under Section 27(1) of the W.T. Act, requiring the Tribunal to refer the following questions of law for the opinion of this court.
'1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that where the assessee made a voluntary disclosure of his income under Section 68 of the Finance Act, 1965, such disclosure provides such information as would entitle the Wealth-tax Officer to initiate proceedings under Section 17 of the Wealth-tax Act, 1957, Sub-clauses (a) and (b) of Sub-section (8) of Section 68 of the Finance Act, 1965, notwithstanding ?
2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that where the assessee made a voluntary disclosure of his income under Section 68 of the Finance Act, 1965, the Wealth-tax Officer can initiate proceedings under Section 17 of the Wealth-tax Act, 1957, in consequence of the information of the disclosure in his possession, when the information of such disclosure has been denied to him under Sub-sections (8)(a) and (8)(b) of Section 68 of the Finance Act, 1965.
3. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in upholding the assessment to wealth-tax for six years from 1958-59 to 1963-64, of the quantum based on the unilateral and unverified declaration in respect of year-wise income, which the assessee made but might not have at all made under Section 68(2)(b) of the Finance Act, 1965?'
9. According to the Tribunal a question of law arose out of its order. The Tribunal, however, after reframing questions Nos. 1 and 2 as sought to be raised by the assessee, referred the following question under Section 27(1) to this court for its opinion :
'Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the Wealth-tax Officer was right in initiating proceedings under Section 17 of the Wealth-tax Act, 1957, on the basis of disclosure made under Section 68 of the Finance Act, 1965, by the assessee ?'
10. The Tribunal, however, refused to refer question No. 3 as framed by the assessee.
11. Mr. K. Ray, learned counsel for the assessee, has submitted that the question referred to this court is wide enough to cover the contention of the assessee relating to the jurisdiction of the WTO in initiating proceedings under Section 17 of the W.T. Act, and that payment of the tax under the Voluntary Disclosure Scheme, according to Section 68 of the Finance Act, 1965, did not make the assessee liable for the payment of wealth-tax.
12. Referring to Section 68 of the Finance Act, 1965, Mr. Ray contended that the declaration made under the said section being outside the scope and purview of the permanent tax Acts the officer employed in the execution of the Acts could not take any cognisance of the particulars contained in the declaration except for the limited purpose of Sub-section (6)(a) of Section 68. It was further submitted that in the instant case proceedings were initiated by the WTO on the basis of the disclosure made in the disclosure petition made by the assessee under the Voluntary Disclosure Scheme under the Finance Act, 1965. In support of this, he referred to the several assessment orders of the WTO. Mr. Ray further submitted that the initiation of proceedings under Section 17 of the W.T. Act was bad and the WTO had no jurisdiction to do so in view of the fact that, after the filing of the declaration under Section 68 of the Finance Act and payment of the tax under the said Scheme, there was no further liability on the part of the assessee to pay any wealth-tax and in that view of the matter it was not open to the WTO to initiate any proceedings for the reopening of the assessment under Section 17 of the W.T. Act.
13. Mr. Ajit Sengupta, learned counsel for the revenue, has submitted that the scope of the question referred to this court for its opinion is very limited. According to him, the only controversy that arises in the instant reference is whether the WTO was right in initiating the proceedings. The question does not cover the contention as made by the assessee regarding the WTO's jurisdiction to initiate the proceedings. Mr. Sengupta has further submitted that in the instant case, as will appear from the statement of the case and the order of the Tribunal, the initiation of proceedings under Section 17 was on the basis of the letters written by the assessee to the ITO giving particulars of the disclosure made by the assessee under Section 68 of the Finance Act, 1965. According to Mr. Sengupta, the initiation of proceedings in the instant case was not on the basis of the declaration petition filed by the assessee under Section 68 or on the basis of any record relating tothe said section. Mr. Sengupta has farther submitted that it is clear from the express language of Section 68 of the Finance Act that it only relates to the payment of income-tax and such payment does not absolve the liability of the assessee for the payment of wealth-tax.
14. As stated hereinbefore the Tribunal in the instant reference has referred the question after reframing question Nos. 1 and 2 as framed by the assessee. In the facts and circumstances of the case and reading the question referred to this court in the context of the said two questions, which the assessee asked the Tribunal to refer to this court, it appears that the question referred by the Tribunal would also cover the controversy relating to the jurisdiction of the WTO to initiate proceedings under Section 17 of the W.T. Act as contended by Mr. K. Ray.
15. It appears from para. 3 of the statement of case that on the basis of the information contained in the two letters dated 25th March, 1965, and 15th March, 1963, the WTO initiated proceedings under Section 17 of the W.T. Act against the assessee. Further, from the Tribunal's order it appears that the findings of the fact of the AAC, as stated hereinafter, was not disputed by the assessee before the Tribunal. Those facts as will appear from the AAC's order are :
'......that there was a letter from the appellant dated 25th March, 1965, addressed to the ITO, 'I' Ward, Dist. III(I), informing him that the appellant had made a disclosure of Rs. 2,98,000 under the Voluntary Disclosure Scheme, 1965, and paid a tax of Rs. 1,69,860 on 23rd March, 1965. He was further informed that the balance amount of Rs. 1,29,140 was taken into the appellant's accounts. Along with this letter a copy of the letter dated 15th Feb., 1963, to the Commissioner of Income-tax was also enclosed.'
16. It appears from the statement of the case and from the Tribunal's order that the initiation of proceedings by the WTO under Section 17 was on the basis of the two letters mentioned hereinbefore. Those facts found by the Tribunal are binding on the parties in the instant reference and in that view of the matter we are unable to accept the submission of Mr. Ray that in the instant case the, initiation' of proceedings under Section 17 of the W.T. Act was on the basis of the disclosure petition made by the assessee under Section 68 of the Finance Act, 1965.
17. We are also unable to accept the other contentions of Mr. Ray, namely, that upon payment of the tax under the Voluntary Disclosure Scheme under Section 68 of the Finance Act no further liability remained on the assessee for the payment of wealth-tax. From the clear language of the said section it appears that the disclosure to be made under the said section was in respect of income-tax and what is paid under the said section by an assessee is on account of income-tax. Therefore, by such payment it cannot besaid that the assessee was absolved from the liability for the payment of wealth-tax.
18. The cases referred to in the instant reference, namely, Tulsiram Sanganaria v. Smt. Anni Bai : [1971]79ITR502(SC) , Pooran Mal v. Director of Inspection, : [1974]93ITR505(SC) , v and D. C. Shah v. CWT : [1979]117ITR348(KAR) , in our opinion, are not very relevant and, therefore, it is not necessary to deal with the same in any detail. Further, in the instant case, as the language of the said section is quite clear, in our view, no reference can be made to the Finance Minister's speech read in Parliament while introducing the Bill in Parliament.
19. In the aforesaid view of the matter, we answer the question in the affirmative and in favour of the revenue.
20. There will, however, be no order as to costs,
Deb, J.
21. I agree.