High Court Of Bombay
Shardadevi P. Jhunjhunwala & ORS. vs. CIT & ANR.
Section. 273A
Assessment years 1970-71 to 1987-88
Ferdino I. Rebello & D.G. Karnik, JJ.
Writ Petn. No. 428 of 1996
14th September, 2009
Counsel Appeared :
P.S. Jetly with G.S. Jetly & A.S. Tungare, for the Petitioners : P.S. Sahadevan for the Respondents
JUDGMENT
Ferdino I. Rebello, J. :
The petitioner by the present petition seeks to impugn the order dt. 21st June, 1993 under s. 273A (4) of the IT Act and order dt. 31st Oct., 1994 under s. 273A(1)(i) of the IT Act.
Search operations were carried out in the premises of the petitioners and of their associates on 22nd Aug., 1986. In the search carried out, shares/debentures/units valued at Rs. 82,00,000, cash of Rs. 7,25,000, ornaments and jewellery valued at Rs. 11,34,280 and silver utensils valued at Rs. 2,70,000 were seized. Various incriminating documents including one diary called “Boston diary” was also seized. Copies of the documents and seized material were supplied to the petitioners. Between 13th Sept., 1986 and 18th Dec., 1986, various steps were taken. On 18th Dec., 1986 order was passed under s. 132(5). On 14th Jan., 1987 an application was moved under s. 132(11), but it appears no action was taken due to further developments. An application under s. 273A was made on 27th Jan., 1987. On 27th Jan., 1987 the petitioners in this petition disclosed additional income of Rs. 2.29 crores. On 3rd March, 1987 the group filed revised returns. On 31st March, 1987 according to petitioners, the group paid annual tax of Rs. 1,06,00,000 on additional income disclosed in the revised returns for the asst. yrs. 1970-71 to 1987-88. The assessment pursuant to revised returns were finalized by the Department by accepting the disclosed income.
Petitioners have approached this Court contending that petitioner Nos. 1 to 9 are nationals and citizens of India. Petitioner No. 10 is the partnership firm. Petitioner Nos. 1 to 4 are assessees on their own. The petitioner Nos. 5 to 9 represent their respective HUFs. The petitioners are required to be assessed to tax under the provisions of IT Act (which hereinafter shall be referred to as Act) as also under the provisions of the Wealth Tax Act, 1957 (which hereinafter shall be referred to as “Wealth Tax Act” wherever applicable).
4. Though on 22nd Aug., 1986 search and seizure action was carried out on some of the members of the Jhunjhunwala Group, there was no search warrant or search action in the case of the petitioners. In the course of search action, a statement was made under s. 132(4) that income will be voluntarily offered by the members of the Jhunjhunwala Group. Pursuant to the said statement, the members of the group worked out figures for offer and voluntarily made written offer on 27th Jan., 1987 for the total amount of Rs. 2.29 crores in the hands of different members of the group for different years. The petitioners are the members of Jhunjhujwala Group.
5. According to petitioners, the disclosure was made on the clear understanding from the concerned authorities that there will be no penal liability and penal interest if any will be waived. On the basis of such assurance by the authorities concerned and with a view to avoid litigation and to buy peace of mind, the offer was made at the much higher figure. The offer made has been accepted without any investigation or verification and the assessments have been completed accordingly. In the course of search, a diary called “Boston diary” was found which was the main item in question. The notings in the Boston diary could not have been deciphered by anyone except one or two persons from Jhunjhunwala Group. Without their initiative, help and assistance nothing could have been found by the Departmental authorities from the said Boston diary. According to petitioners this has been confirmed by the first respondent in his order dt. 31st Oct., 1994. Further, it is not in dispute and confirmed by the respondent that the members of the Jhunjhunwala Group have voluntarily assisted and co-operated in deciphering the said diary and had voluntarily offered the amount for taxation. So far as asst. yr. 1987-88 is concerned, the offer was made even before the due date of the filing of the return was over and in the original return of income itself additional amount was offered. In these circumstances, no penalty could have been levied for the asst. yr. 1987-88 since the offer was same in the original return of the income itself. However, certain penalty and interests were levied.
6. The total amount under different provisions totalled to Rs. 1.44 crores. Out of this, an amount of Rs. 49 lacs. had already been paid and the balance amount of penalty remaining unpaid was Rs. 95 lacs. The interest and penalty imposed was as under :
7. We may now reproduce the relevant provisions of s. 273A as it then stood :
“273A. Power to reduce or waive penalty, etc., in certain cases—(1) Notwithstanding anything contained in this Act, the CIT may, in his discretion, whether on his own motion or otherwise,— (i) reduce or waive the amount of penalty imposed or imposable on a person under cl. (i) of sub-s. (1) of s. 271 for failure, without reasonable cause, to furnish the return of total income which he was required to furnish under sub-s. (1) of s. 139; or (ii) reduce or waive the amount of penalty imposed or imposable on a person under cl. (iii) of subs. (1) of s. 271; or (iii) reduce or waive the amount of interest paid or payable under sub-s. (8) of s. 139 or s. 215 or s. 217 or the penalty imposed or imposable under s. 273 if he is satisfied that such person— (a) in case referred to in cl. (i), has, prior to the issue of a notice to him under sub-s. (2) of s. 139, voluntarily and in good faith made full and true disclosure of his income; (b) in the case referred to in cl. (ii), has, prior to the detection by the AO, of the concealment of particulars of income or of the inaccuracy of particulars furnished in respect of such income, voluntarily and in good faith, made full and true disclosure of such particulars, (c) in the cases referred to in cl. (iii), has, prior to the issue of a notice to him under sub-s. (2) of s. 139, or where no such notice has been issued and the period for the issue of such notice has expired, prior to the issue of notice to him under s. 148, voluntarily and in good faith made full and true disclosure of his income and has paid the tax on the income so disclosed, and also has, in the case referred to in cls. (a), (b) and (c), co-operated in any inquiry relating to the assessment of his income and has either paid or made satisfactory arrangements for the payment of any tax or interest payable in consequence of an order passed under this Act, in respect of the relevant assessment year. Explanation : For the purposes of this sub-section, a person shall be deemed to have made full and true disclosure of his income or of the particulars relating thereto in any case where the excess of income assessed over the income returned is of such a nature as not to attract the provisions of cl. (c) of sub-s. (1) of s. 271. (2) Notwithstanding anything contained in sub-s. (1),— (a) if in a case the penalty imposed or imposable under cl. (i) of sub-s. (1) of s. 271 or the minimum penalty imposable under s. 273 for the relevant assessment year or, where such disclosure relates to more than one assessment year, the aggregate of the penalty imposed of imposable under the said clause or of the minimum penalty imposable under the said section for those years, exceeds a sum of one hundred thousand rupees, or; (b) if in a case falling under cl. (c) of sub-s. (1) of s. 271, the amount of income in respect of which the penalty is imposed or imposable for the relevant assessment year, or, where such disclosure relates to more than one assessment year, the aggregate amount of such income for those years, exceeds a sum of five hundred thousand rupees, no order reducing or waiving the penalty under sub-s. (1) shall be made by the CIT except with the previous approval of the Board. (3) Where an order has been made under sub-s. (1) in favour of any person, whether such order relates to one or more assessment years, he shall not be entitled to any relief under this section in relation to any other assessment year at any time after the making of such order : (4) Without prejudice to the powers conferred on him by any other provision of this Act, the CIT may, on an application made in this behalf by an assessee, and after recording his reasons for so doing, reduce or waive the amount of any penalty payable by the assessee under this Act, or stay or compound any proceeding for the recovery of any such amount, if he is satisfied that— (i) to do otherwise would cause genuine hardship to the assessee, having regard to the circumstances of the case; and (ii) the assessee has co-operated in any inquiry relating to the assessment or any proceeding for the recovery of any amount due from him : Provided that where the amount of any penalty payable under this Act or, where such application relates to more than one penalty, the aggregate amount of such penalties exceeds one hundred thousand rupees, no order reducing or waiving the amount or compounding any proceeding for its recovery under this sub-section shall be made by the CIT except with the previous approval of the Board. (5) Every order made under this section shall be final and shall not be called into question by any Court or any other authority. (6) The provisions of this section as they stood immediately before their amendment by the Direct Tax Laws (Amendment) Act, 1989 (3 of 1989) shall apply to and in relation to any assessment for the assessment year commencing on the 1st day of April, 1988, or any earlier assessment year, and references in this section to the other provisions of this Act, shall be construed as references to those provisions as for the time being in force and applicable to the relevant assessment year.” This sub-section was inserted to by Direct Tax Laws (Amendment) Act, 1987 w.e.f. 1st April, 1989. The following Explanation below sub-s. (1) was omitted by Finance Act, 1985 w.e.f. 24th May, 1985 : “Explanation 2 : Where any books of account, other documents, money, bullion, jewellery or other valuable article or thing belonging to a person are seized under s. 132 and within fifteen days of such seizure, the person makes a full and true disclosure of his income to the CIT, such person shall, for the purposes of cl. (b) of sub-section, be deemed to have made, prior to the detection by the ITO of the concealment of particulars of income or of the inaccuracy of particulars furnished in respect of such income, voluntarily and in good faith, a disclosure of such particulars.”
An application under s. 273A was jointly made on behalf of the petitioners by their application of 27th Jan., 1987. This was further elaborated by communication of 22nd March, 1991. Insofar as the application under s. 273A(1)(i) is concerned, the CIT was pleased to hold that the petitioners had not satisfied the requirement that the disclosure was “voluntary”. The petitioner had offered, complied with all the other conditions in as much as they had co- operated in the investigation, relating to assessment of income-tax. They had also either paid or made satisfactory arrangements for payment of taxes or interests. The assessments were also made on the basis of the disclosures made by the assessees. As the CIT recorded a finding that the disclosure was not made voluntary, he rejected the application under s. 273A(1)(i) which provides for waiver of penalty and interest. Similarly in respect of the application under s. 273A(4), the CIT recorded a finding that the petitioners herein had not made out a case of genuine hardship and accordingly dismissed the said application.
At the hearing of this application, on behalf of the petitioners it is submitted by their learned counsel that respondent No. 1 misdirected himself in law in relying on the judgment in the case of Tribhovandas Bhimji Zaveri vs. Union of India & Ors. (1993) 115 CTR (SC) 411 : (1993) 204 ITR 368 (SC). It is submitted that the judgment in the case of Tribhuvandas was in the context of s. 3 of the Voluntary Disclosure of Income and Wealth-tax, 1976 (VDIS). It is therefore, submitted that the ratio of the said judgment could not have been attracted while considering the provisions of s. 273A. On this count alone, it is submitted that the order is liable to be set aside.
The learned counsel submits that the petitioner in respect of s. 273A(1)(i)(a) had made disclosure prior to issuance of notice and further voluntarily and in good faith made true and full disclosures of the income and paid the full tax as also co-operated in the inquiry relating to the assessment of his income and either paid or made satisfactory arrangements for the payment of the tax or interest payable in consequence of the order passed under this Act. It is further submitted that insofar as s. 273A(1)(ii) is concerned, the application was made prior to detection by the ITO/AO and as such also complied with the requirements. The respondent No. 1 has not addressed himself to the said contention and consequently the order made under s. 273A(1)(i) is liable to be set aside and the matter be remanded back to respondent No. 1 for reconsideration. Insofar as the order passed under s. 273A(4) it is submitted that the application was only rejected on the ground that the petitioners had failed to make out the case of genuine hardship. Insofar as the hardship is concerned, the respondent No. 1 did not take into consideration that the petitioners themselves had directed the Unit Trust of India to dispose of the shares at any available price and to pay the sale proceeds directly to the IT Department. It is therefore, submitted that the order is liable to be set aside and consequently the matter be remanded back to respondent No. 1 for de novo consideration. The learned counsel has placed reliance on several judgments in support of the contentions, to which we shall subsequently advert to in the course of deciding the controversy.
12. Insofar as s. 273A is concerned, the condition precedent before exercise of powers to reduce or waive penalty or interest by the CIT as per the law as settled are : (a) there must be voluntary disclosure of income before the issue of notice under s. 139(2); (b) the assessee must have made true and full disclosure of income in good faith prior to detection by the AO; (c) the assessee must have co-operated in the conduct of the assessment proceedings; and (d) the assessee must have paid or made satisfactory arrangements for payment of tax or interest payable in consequence of the order passed under the Act with respect to the relevant assessment year. Insofar as s. 273A(4) is concerned, the predicates required to be satisfied are : (1) On the facts of the case there would be genuine hardship to the assessee if the relief is not granted. (2) The assessee has co-operated in the inquiry relating to the assessment or in proceedings for recovery of any amount due from him.
13. Considering these provisions, let us first consider the judgments relied upon on behalf of the petitioners. The learned counsel has placed reliance in the judgment in the case of Full Bench of Allahabad High Court in the case of Bhairav Lal Verma vs. Union of India (1998) 146 CTR (All)(FB) 16 : (1998) 230 ITR 855 (All)(FB). The Court there was considering the case under the provisions of s. 273A(1)(i) of the IT Act. The learned Full Bench after considering various judgments including the case of Tribhovandas Bhimji Zaveri vs. Union of India & Ors. (supra) to which we shall advert subsequently, was pleased to hold that disclosure of concealed income after the Department has seized incriminating material disclosed, cannot be voluntary disclosure, because it is made under the constraint of exposure to adverse action by the Department. The Court then observed that it cannot be held as a principle of law that the disclosure of income made after the search/raid cannot be voluntary. It is a question which has to be decided by the Department in each case on the basis of the material on record. If on record there is incriminating material with regard to the disclosed income, disclosure cannot be voluntary. But if the Department has no incriminating material with regard to the income disclosed, the disclosure will have to be treated as voluntary.
14. Reliance then was placed on the judgment of the learned Single Judge of Madras High Court in K.M. Radha Krishna Chettiar & Co. vs. CIT & Anr. (2001) 166 CTR (Mad) 31 : (2000) 244 ITR 374 (Mad). The learned Judge was pleased to set aside the order impugned thereon the ground that the CIT there had not applied his mind as there was no finding as to the compliance or otherwise of the conditions imposed under s. 273A nor the first respondent had assigned any reason whatsoever for refusing the relief sought for by the petitioner under s. 273A while exercising his discretion nor the first respondent had applied his mind or satisfied himself whether the petitioner made the disclosure with a fear relating to the imminent and proximate exposure to penal action.
15. Reliance is also placed in the judgment of the Andhra Pradesh High Court in K.S.N. Murthy vs. Chairman, CBDT & Ors. (2001) 171 CTR (AP) 563 : (2001) 252 ITR 269 (AP). In that case the learned Judge on the facts there found that the order does not reflect due application of mind on the part of the CIT to the facts of the case. As exercise under s. 273A is quasi judicial, it is incumbent on the CIT to apply his mind to all the relevant facts to satisfy himself whether the return has been filed voluntarily and in good faith making full and true disclosure and whether the assessee has co-operated with the Department in concluding the assessment and whether he has paid the tax or made satisfactory arrangements for payment thereof or in other words to satisfy himself as to the existence of the ingredients of the provisions and that the CIT cannot take into consideration the facts extraneous to the provisions or factors not germane to the decision making.
15A. Reliance was also placed on the judgment of the learned Single Judge of this Court in Rohit Kumar & Co. & Ors. vs. F.J. Bahadur, CIT & Ors. (1991) 92 CTR (Bom) 260 : (1991) 190 ITR 93 (Bom). The issue before the learned Single Judge was a case of seizure made on 30th April, 1981. Six days thereafter petitioner brought to the notice of the Dy. Director of Inspection (Intelligence) as well as the CIT that that amount belonged to them and should be treated as its income for the asst. yr. 1981-82. The previous year for the relevant assessment year had not ended. On these facts the learned Court came to the conclusion that there is no question of concealment at the hands of the assessee far less a case of detection and the returns filed cannot but be held to be voluntary and in good faith.
16. Reliance was also placed in the case of Division Bench of this Court in Dr. Mrs. Sudha Kankariya vs. CIT & Ors. (2004) 188 CTR (Bom) 404 : (2004) 270 ITR 296 (Bom). On the facts there, there was no search. The assessee husband of his own free will approached the ITO and made a voluntary disclosure before the AO and offered for taxation amounts which were deposited by him and the assessee in Andhra Bank. The CIT declined to consider the application of the petitioner under s. 273A on the ground that there was no voluntary disclosure. It is on these facts that the learned Bench was pleased to hold that, the disclosure was voluntary. The learned Bench observed that what is required to be seen is whether the voluntary disclosure is prior to the detection by the AO and in that case that condition is fulfilled by the assessee. The order was accordingly set aside and the matter remanded back to the CIT.
17. We may now consider the judgment of the Supreme Court in Tribhovandas Bhimji Zaveri (supra). It is true that the said judgment was under the provisions of the VDIS Act. What came up for consideration was applicability of s. 3 or s. 14 of the Act. The Court observed that the object of the Act is to motivate the voluntary declaration of concealed income and with that object in mind the Schedule to the Act prescribes concessional rates of tax. It was then observed as under : “A declaration of concealed income made after books of account or other documents or valuable assets have been seized cannot be said to be a voluntary disclosure; it is made because the books, documents and assets seized would disclose to the assessing authority the concealment of income.” A Division Bench of this Court in Natwarlal Joitram Raval vs. CIT & Ors. (1993) 115 CTR (Bom) 518 was pleased to observe as under : “We are inclined to agree with the Kerala High Court that in every case the CIT must, having regard to the search, seizure or statements, determine whether or not the disclosure subsequently made is or is not voluntary, but, we are also inclined to agree with the Allahabad High Court that where a disclosure is made consequent upon seizure of incriminating material relevant to the particular assessment year, the disclosure is made because adverse consequences under the Act are attracted. Such a disclosure is not voluntary.”
It will be clear that insofar as Division Bench of this Court is concerned, it was clearly of the opinion that when the disclosure is made subsequently to the seizure of incriminating material, the disclosure is made because of adverse consequences and such disclosure is not voluntary. On the facts of our case, the disclosure was made pursuant to search and seizure of incriminating material which includes the “Boston diary”. The issue whether the authorities could have deciphered the documents on their own without petitioner co-operating, in our opinion is immaterial. There is nothing on record to state that in due course exercising their powers under the Act, the authorities could not have deciphered the seized material. The view taken by the Court is in conformity with the view taken in Tribhovandas Bhimji Zaveri (supra).
We may then refer to two judgments under the provisions of s. 273A(4) of the Act in Garden Silk Weaving Factory vs. CIT (1995) 125 CTR (Guj) 157 : (1995) 213 ITR 10 (Guj). The Gujarat High Court was considering whether on the facts of the case, the CIT had considered the issue of genuine hardship. The Court found that the issue of hardship had not been considered and accordingly remanded the matter back to the CIT. In B.M. Malani vs. CIT & Anr. (2008) 219 CTR (SC) 313 : (2008) 13 DTR (SC) 186 : (2008) 306 ITR 196 (SC), the Supreme Court was considering the issue of genuine hardship under s. 220 (2A) of the IT Act. Considering the provisions there, the Court was pleased to hold that : “The ingredients of genuine hardship must be determined keeping in view the dictionary meaning thereof and the legal conspectus attending thereto.” In Benera Valves Ltd. vs. CCE 2006 (204) ELT 513 (SC), considering the expression “undue hardship” the Court noted that there is a matter within special knowledge of the applicant and has to be established by him. Secondly under Indian conditions, it is normally related to economic hardship. The Court observed the quoting in the judgment in S. Vasudev vs. State of Karnataka (1993) 2 SCR 715 that something which is not merited by the conduct of the claimant or is very much disproportionate to it.
20. Before answering the issue, we may now consider the effect of the Expln. 2, though it has since been omitted. An Explanation is at times appended to a section to explain the meaning of the words contained in the section. See Dipak Chandra Ruhidas vs. Chandan Kumar Sarkar (2003) 7 SCC 66. When the Explanation opens with the words “for the purpose of this section” or when it is added towards the end of the section, it prima facie indicates that the Explanation applies to all the clauses in the section. See CED vs. Kantilal Trikamal AIR 1976 CTR (SC) 391 : 1976 SC 1935. By the Explanation it was made clear that if any books or documents, money, bullion, amongst others are seized under s. 132 and within fifteen days of such seizure, the person makes a full and true disclosure of his income to the CIT, such person shall, for the purpose of cl. (b) of this subsection, be deemed to have made, prior to the detection by the ITO of the concealment of particulars of income or of the inaccuracy of particulars furnished in respect of such income, voluntarily and in good faith, a disclosure of such particulars. The Explanation has since been omitted w.e.f. 1st Oct., 1984. What this would mean is firstly the contention raised on behalf of the petitioners that the seizure of documents by authority other than ITO/AO is not detection by the AO has to be rejected. Secondly and consequently once the documents are seized then any disclosure subsequently made would not be voluntary. The omitted Explanation only had sought to bring or to make it voluntary for a period which otherwise was not voluntary. The omission would only mean that this deemed voluntariness is now no longer legally available. Considering this aspect of the matter and considering the judgment in Tribhovandas Bhimji Zaveri (supra) and the judgment in the case of Division Bench in Natwarlal Joitram Raval (supra), it would be clear that any disclosure made subsequent to seizure of incriminating material, such disclosure would not be voluntary. The Full Bench judgment of Allahabad High Court in Mohd (supra), also makes that position clear. It is clarified there that pursuant to the search incriminating material is found and disclosure made, the disclosure is liable to be treated as not voluntary but if no incriminating material is found and still disclosure is made, then it would be treated as voluntary.
On that touch stone let us consider the facts and arguments advanced on behalf of the petitioner. The only ground that is contended to say that it was voluntary was that without their assistance, the Revenue authorities could not have deciphered the “Boston diary” and it is only because of the co-operation rendered by the petitioners that the authorities could decipher the said diary. In our opinion, that is immaterial. The diary contained incriminating material based upon which the additional income was disclosed. Merely because petitioners co-operated in deciphering the documents would not mean that the respondent Revenue authorities could not have deciphered the same. The test is whether any incriminating material was found. On the petitioner’s own statement the diary contained incriminating material. The application was made after that incriminating material was found. In these circumstances, in our opinion, the contention urged on behalf of the petitioners must be rejected. It is true that the CIT did not consider this aspect of the matter. That however, does not mean that the finding otherwise arrived at by the CIT that the disclosure was not voluntary can be faulted. In our opinion, considering the material on record no purpose would be served in remanding the matter back to the CIT for reconsideration on this aspect considering the law as now understood and the facts on record.
According to the petitioner, the CIT did not consider the various tests under s. 273A(4) for rejecting the application. The first order was made on 21st June, 1993 under s. 273A(4). The order in respect of s. 273A(1) was made on 31st Oct., 1994. There is no finding by the CIT apart from hardship. Would this vitiate the order ? If the respondent No. 1 considering the application holds that two predicates have been satisfied one of which was hardship. Considering the test as laid down by the Supreme Court in the case of B.M. Malani (supra), and Benera Valves Ltd. (supra) the test is of undue or genuine hardship. The genuine difficulty would also mean that there is hardship that will be occasioned if the petitioner was called upon to pay the penalty. Such hardship normally would be financial hardship that would be occasioned. The only ground made out on behalf of the petitioner is by referring to their contention as raised in the written statements which were filed that the petitioners had entrusted all their shares to Unit Trust of India to be sold at any available price but the petitioners in the said argument itself have thereafter stated as under : “This evidently shows the spirit of co-operation and desire to comply with the terms of s. 273A.”
It was not on the ground of financial hardship. Documentary evidence by way of balance sheet or any other material was not produced to show that the petitioners were not in a position to pay the penalty and if they had paid penalty, there would be adverse consequence on the petitioners. It was for the petitioners to produce that material to discharge the burden and for the respondents to consider the same. No such material was placed by the petitioner before respondent No. 1. In the absence of placing material, petitioners cannot be heard to complain that there was noncompliance by the respondent CIT in considering the case under s. 273A(4) nor has any material been placed before this Court to show hardship that would be occasioned to the petitioners assuming it could be placed. The learned CIT has recorded a finding that the petitioner did not produce any evidence to show that he did not have adequate financial resources. That by itself must have met the test. However, in the absence of the petitioners placing any other material on hardship, the findings recorded by the CIT cannot be faulted with. At any rate, in our opinion, no purpose would be served in the exercise of our extraordinary jurisdiction to remand the matter back to the CIT.
The only other argument advanced was in respect of the penalty and interest imposed insofar as asst. yr. 1987-88 is concerned relying on the judgment in the case of Rohit Kumar. The returns were filed only after the seizure of the incriminating material. The issue of whether penalty or interest could be levied was in issue in proceedings for adjudication. In the instant case, the levy of penalty or interest including for the asst. yr. 1987-88 has not been challenged and has become final. Sec. 273A is an independent power notwithstanding anything contained in the Act. Therefore, even if interest and penalty has been levied in proceedings for adjudication, the respondents have power under s. 273A to reduce the penalty or interest under s. 273A as it then stood. The test for waiver or reduction, for exercise of discretion are different. Under s. 273A the party applying must make out a case of genuine hardship. The finding by the CIT is that the respondent has not made out a case of genuine hardship. Insofar as s. 273A(1) is concerned, the disclosure must be voluntary. The CIT has come to the conclusion that the declaration was not voluntary. For the asst. yr. 1987-88, it is true that the returns were filed in the ordinary course. The return was based on additional income contained in the incriminating material contained in the Boston diary. It is obvious if the material had not been seized during search and seizure operations including the Boston diary, the income in terms of the diary could never have been disclosed as in the case of the past years. In the circumstances if the respondents have come to the conclusion that it was not voluntary, and refused to grant relief, it will not be a fit case for us to exercise our extraordinary jurisdiction.
For all the above said reasons, we find no merit. Hence, rule discharged. There shall be no order as to costs.
[Citation : 327 ITR 211]
