Law:

Section:

Section 68 of the Income-tax Act, 1961 - Cash credits - Assessee filed her return showing loss on sale of gold jewellery and diamonds - Notices under section 143(2)(i) were issued informing assessee to appear with books of account, bills, vouchers and details of assets acquired - Assessee produced books of account maintained by her - It was also contended that assessee had filed a declaration under Voluntary Disclosure of Income Scheme, 1997, on 23-12-1997 under section 68(2) of said scheme, wherein she had declared income in form of gold jewellery and diamonds for value of Rs. 3,51,213 in respect of assessment year 1987-88 and report of valuation of jewellery and ornaments was also filed - Said application was accepted and a certificate had been issued, after valuing said gold jewellery and diamonds by indexed method and same had been declared in return of income - Assessing Officer held that assessee had failed to prove transaction of sale to 'M' for an amount of Rs. 4,08,030 and sale of diamonds for Rs. 4,21,250 to 'S' - He, thus, made addition of those amounts to assessee's income by invoking provisions of section 68 - Commissioner(Appeals) as well as Tribunal upheld assessment order - On instant appeal, it was noted that if sale transactions to 'M' and 'S' were in respect of goods which were subject-matter of declaration filed under scheme, which declaration had admittedly been accepted by revenue, in such a situation, assessee was not liable to be taxed under section 68 - However, Commissioner(Appeals) and Tribunal, while upholding order passed by Assessing Officer, did not record any finding in respect of aforesaid aspect - Whether, on facts, impugned order passed by Tribunal was to be set aside and matter was to be remanded for disposal afresh - Held, yes FACTS The assessee had filed return of income, declaring total income of Rs. 92,950. The same was selected for scrutiny. The assessee had shown capital loss on sale of diamonds amounting to Rs. 1,038 and a perusal of the personal capital accounts revealed that there was accretion of Rs. 8,29,330 on account of sale of gold jewellery and diamonds. Notices under section 143(2)(i) were issued informing the…

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