NILESH HEMANI Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) By this petition, the petitioner has challenged the notice issued under Section 158BC of the Income-tax Act, 1961, and prayed that the notice be quashed and further prayed that the amount of Rs. 1,35,00,000 be returned to the petitioner.

(2.) The case of the petitioner is that the petitioner has been carrying on business as importer and also carrying on business of dealing in shares for the last several years. In 1997, a Voluntary Disclosure Scheme (hereinafter called "the Scheme"), came into force with effect from July 1, 1997. Under that Scheme any person could make a declaration in respect of any income chargeable to tax under the Income-tax Act, 1961 (hereinafter referred to as "the Act"), which has not been subject to tax earlier. Section 67(1) of the Scheme provides that the declarant could file a declaration without paying the tax but such tax has to be paid within three months from the date of filing of the declaration with simple interest at the rate of 2 per cent, per month for the period from the date of filing of the declaration to the date of payment of tax and document in proof of such payment is to be filed within the said period of three months.

(3.) The petitioner filed the declaration on October 3, 1997, disclosing the amount of Rs. 1,35,00,000 which was not taxed earlier. The case of the petitioner is that the said amount of Rs. 1,35,00,000 is lying in locker No. 175 of the Allahabad Bank, Peddar Road Branch, Mumbai, and that he requested the Departmental authority to adjust the tax payable on the said amount, out of the amount lying in the said locker of the bank, but the request has not been accepted regarding adjustment of tax out of money in the locker. Thereafter, the petitioner managed the tax amount on his own and paid the tax within three months as required under the Scheme.