CHIEF COMMISSIIONER OF INCOME TAX Vs. PAMPAPATHI HOSPET

JUDGEMENT

(1.) THIS appeal is by the revenue challenging the order passed by the Income-tax Tribunal, Bangalore Bench in I. T. A. No. 122/pnj/98 dated 4-6-2003, wherein the Tribunal has reversed the concurrent findings of the orders passed by the assessing Officer and the Commissioner of income-tax (Appeals ).

(2.) THE respondent-assessee is a partnership firm indulged in extraction of iron-ore from mines taken on lease and exports it through Minerals and Metal Trading Corporation of India Ltd. , Madras. The assessee during relevant assessment years had filed the return of income. There was a search conducted on the premises of the assessee on 12th and 13th of December, 1994. A statement under Section 132 (4) of the Income-tax Act was recorded by the authorised officer at the instance of the partners of the assessee. They agreed to disclose voluntarily offering a tax on the income of Rs. 1,15,00,000/- subject to deductions under Section 80hhc for the assessment years 1992-93 to 1995-96. Later on one of the partners of the firm, on 25-1-1995 addressed a letter to the Department stating that the partners are willing to voluntarily offer an additional income of a sum of rs. 1,47,00,000/- which is inclusive of rs. 1,15,00,000/- declared earlier for four assessment years namely 1992-93,1993-94, 1994-95 and 1995-96 subject to deduction under section 80hhc and the letter further disclosed in the above terms that a revised return would be filed. Thereafter revised returns were filed by the assessee for each assessment years. The revised return was not accepted by the assessing Officer only on the ground that the revised return is not in confirmity with the letter dated 25-1-1995. The Assessing Officer rejecting the revised return and passed an order of assessment based on the admissions made in the letter dated 25-1-1995 addressed by a partner of the respondent-assessee.

(3.) AGGRIEVED by the order passed by the assessing Officer, the assessee filed an appeal before the Commissioner of Income-tax (Appeals), Hubli. The appeal filed by the assessee came to be dismissed by the Commissioner of Income-tax only on the ground that when a partner of the assessee firm on 25-1-1995 has voluntarily agreed to disclose the higher income, the rejection of the revised return filed by the Assessing Officer was found to be correct. Accordingly the appeal filed by the assessee was dismissed. Thereafter the assessee filed a second appeal before the Income-tax Appellate Tribunal, which appeal was allowed by the Tribunal after hearing the learned counsel appearing for both the parties, by holding that the letter dated 25-1-1995 could not have been considered by the assessing Officer and he could not have passed an order of assessment without considering the revised return filed by the assessee. Accordingly the appeal was allowed in part, however, the Tribunal has directed the assessing Officer to consider the statement made under Section 132 (4) of the Income-tax act on 13-12-1994 before the authorised officer, wherein the respondent-assessee firm had agreed to offer voluntarily an income of rs. 1,15,00,000/- subject to deductions under section 80hhc of the Income-tax Act. Being aggrieved by the order passed by the tribunal, the present appeal is filed by the revenue.