A voluntary disclosure under Sec.24 of the Finance (No. 2) Act, 1965, provides immunity only to the declarant and not to third parties.

Uday Sinha, J.

1. In this reference under Sec.256(1) of the Income-tax Act, 1961 (hereinafter called "the Act"), we are concerned with the assessment year 1968-69. The assessee is a Hindu undivided family with Ram Kumar Agarwal as karta. The Hindu undivided family carried on business in kirana and foodgrains.

2. The facts calling for the reference in brief are as hereinafter stated. In the books of the assessee were entered loans of Rs. 10,000 each from Shrimati Bimla Devi and Shrimati Geeta Devi. When called upon to explain the cash credits, the assessee asserted that these were monies of the two ladies and in respect of which they had made declarations under Sec.24 of the Finance (No. 2) Act, 1965, under which they had paid income-tax of Rs. 750 each. The stand of the assessee was supported by confirmatory letters sent by the two ladies. The Income-tax Officer did not accept the version of the assessee. He did not accept that they were genuine deposits of the two ladies, as they had never been assessed to income-tax. He, therefore, after rejecting the stand of the assessee, treated these sums aggregating to Rs. 20,000 as income of the assessee from "other sources".

3. In the appeal before the Appellate Assistant Commissioner, the assessee challenged the jurisdiction of the Income-tax Officer to include the sum of Rs. 20,000 as income of the assessee. The Appellate Assistant Commissioner accepted the stand of the assessee. He held as follows :

"Thus, the deposits of Rs. 10,000 each in the business of the appellant-Hindu undivided family by the two ladies are explained properly."

Upon that finding, the Appellate Assistant Commissioner holding that the additions were uncalled for, deleted them.

4 The Department filed an appeal to the Tribunal and contested the finding and the order of the Appellate Assistant Commissioner in regard to the deletion of the said sum of Rs. 20,000. The Tribunal held as follows :

"After hearing both the parties, I am of the view, that the assessees case is well-placed. The ladies made a voluntary disclosure and the Department accepted it. They stated that the amount was available with them for deposit and the Department has not been able to prove that the amount has been invested elsewhere. In such circumstances, the availability of the amount cannot be denied."

With this finding recorded in favour of the assessee, the appeal of the Revenue was dismissed by the Tribunal.

5 The Revenue being aggrieved by the order of the Tribunal has got this reference made to this court under Sec.256(1) of the Act. The question referred to us is:

"Whether, on the facts and in the circumstances of the case, the Tribunal was justified in confirming the order of the Appellate Assistant Commissioner deleting the addition of Rs. 20,000 made by the Income-tax Officer."

Mr. Rajgarhia, learned senior standing counsel, submitted that the Appellate Assistant Commissioner and the Tribunal erred in law in deleting the sum of Rs. 20,000 treating them as genuine investments of the two ladies. It was submitted that the two ladies were none other than the wives of the two partners. Mr. Rajgarhia contended that the decision of the Tribunal was in the teeth of two decisions of the Supreme Court, namely, Jamna Prasad Kanhaiyalal V/s. CIT, 1981 130 ITR 244 ; ITO V/s. Rattan Lal, 1984 145 ITR 183. It was submitted on behalf of the Revenue that a voluntary disclosure in terms of Sec.24 of the Finance (No. 2) Act, 1965, only provided immunity to the declarant and not to third parties. That being the law, the Tribunal had erred in deleting the additions of Rs. 20,000. Thus contended counsel for the Revenue. Having heard counsel for the parties, I am of the view that the submission urged on behalf of the Revenue is untenable. The decisions of the Supreme Court relied upon by the Revenue can be of no avail. Those were cases where the Revenue had not accepted the stand of the assessee that the sums alleged to have been paid by the decl