Law:

Section:

Section 67 of the Finance Act, 1997 - Voluntary Disclosure of Income Scheme, 1997 - Interest payable by declarant - Whether in view of section 67(2) any delay in payment of interest did not have effect of nullifying declaration - Held, yes - Whether where assessee had filed declaration under scheme well within time and also remitted tax due as per declaration together with interest which was also well within time provided under scheme, deficit of small amount of interest which was on account of bona fide mistake did not invalidate declaration - Held, yes FACTS The assessee had submitted a return/declaration under the Scheme on 31-12-1997 and paid the tax together with interest due thereon for the period from the date of declaration till the date of payment on 30-3-1998. The interest paid was in deficit by Rs. 360 which was stated to be by mistake. The respondent, by notice informed the petitioner that the interest remitted was deficit and the petitioner remitted the sum and submitted a reply explaining the circumstances under which the deficit had occurred. However, the respondent treated the declaration submitted by the petitioner as invalid. On writ: HELD From the provisions of section 67, it was clear that a person who had filed the declaration within the time provided under the Scheme has got the facility of paying the tax due thereon along with interest within three months from the date of declaration. However, section 67(2) only referred to non-payment of the tax due as per the declaration within three months and specified the consequence, viz., invalidity of the declaration. It did not refer to non-payment of interest. Though the Department had got a stand that the tax would take interest also having regard to the fact that the tax and interest were separately treated in section 67(1) and the further fact that tax alone was referred to in section 67(2), the tax mentioned in section 67(2) could not take interest also. Of course, no outer time-limit for payment of interest was provided under section 67(1) in case of non-payment of interest along with tax before the expiry of three months. [Para 5] The assessee, according to him, had paid the entire…

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