JUDGMENT Om Prakash, J.
1. Pursuant to an order dated February 15, 1979, passed by this court, the Income-tax Appellate Tribunal drew up a statement of the case referring the following questions for our opinion :
"1. Whether, on the facts and in the circumstances of the case, the Tribunal was legally justified in holding that the Appellate Assistant Commissioner had jurisdiction to entertain an appeal against the order of the Wealth-tax Officer giving effect to the order of the Commissioner of Wealth-tax in revision under Section 25(1) of the Wealth-tax Act, 1957 ?
2. Whether, on the facts and in the circumstances of the case, the Tribunal was legally justified in holding that the tax liabilities were not outstanding for more than 12 months on valuation date and were thus allowable as deduction in the computation of net wealth of the assessee ?"
2. Both the questions revolve round the same factual position and that is briefly stated thus :
The assessee is an individual assessed to wealth-tax. Original assessments were completed in March, 1967, for the years 1960-61 to 1965-66. Subsequently, the Wealth-tax Officer initiated action under Section 17 of the Wealth-tax Act, 1957 (briefly, "the Act"). During the course of reassessment, the assessee claimed income-tax liability for the assessment years 1956-57 to 1965-66 which had arisen as a result of settlement made on October 18, 1966. The Wealth-tax Officer rejected the claim of the assessee and completed the reassessments on December 31, 1971.
3. Against the order of the Wealth-tax Officer, the assessee appealed to the Appellate Assistant Commissioner who dismissed the appeal on technical grounds. Thereafter, the assessee went up in revision before the Commissioner of Wealth-tax, who passed an order as under ;
"The Wealth-tax Officer is directed to modify the wealth-tax assessment by deducting the income-tax liabilities as per law."
4. While passing an order to give effect to the order of the Commissioner of Wealth-tax, the Wealth-tax Officer observed that since the liability arose in October, 1966, when the settlement of the tax liability of the firm was made, the tax liability was relevant to the assessment year 1967-68. He was of the view that before the date of settlement neither any liability was visualised, nor it was admitted by the assessee. The liability created in 1967-68 is partly outstanding for more than 12 months. Apart from that, since the assessee had, admittedly, been withholding the payment of tax for more than 12 months from the date of the order, no deduction is permissible under Section 2(m) of the Wealth-tax Act.
5. On appeal, the Appellate Assistant Commissioner directed the Wealth-tax Officer to allow income-tax liabilities of assessment years under consideration.
6. The Revenue filed an appeal before the Tribunal against the Appellate Assistant Commissioner's order entertaining the appeal against an order giving effect to the order of the Commissioner of Wealth-tax in revision under Section 25(1) and also against the relief allowed in respect of income-tax liabilities.
7. The assessee filed appeals against the Appellate Assistant Commissioner's order not allowing the entire tax liability.
8. On further appeal, the Tribunal held that it has to be borne in mind that the assessee had made a voluntary disclosure and that the assessee had agreed for certain additions. In the revision, the Commissioner of Wealth-tax found that there was force in the assessee's contention that the income-tax liability had to be deducted from the net wealth of the assessee. The Commissioner of Wealth-tax accordingly gave a direction, reproduced above, to the Wealth-tax Officer, the Tribunal further found :
"It is pertinent to note that the order of the Commissioner of Wealth-tax in the concluding portion states that the Wealth-tax Officer has to allow the claim as per the provisions of law. According to us, the last words, i.e., as per law are fatal to the argument of the learned Departmental Representative. Because the words 'as per law' means that the Wealth-tax Officer has to reconsider the claim of the assessee and since the Wealth-tax Officer did not consider the claim of the assessee an appeal lies against that order of the Wealth-tax Officer. Therefore, we hold that the Appellate Assistant Commissioner did have jurisdiction to entertain the appeals."
9. This is one part of the findings of the Tribunal, from which question No. 1 arises.
10. The Tribunal then found :
"The next objection for our consideration is whether the Appellate Assistant Commissioner was justified in allowing the claim of the assessee for deduction of the income-tax liabilities as it amounts to debt.
It cannot be forgotten that when the assessee came forward under the voluntary disclosure scheme and that the assessee agreed for certain additions with (sic-which) spread over a number of years, there was income-tax liability created because of the voluntary disclosure made by the assessee. The arguments of the learned Departmental Representative that before the voluntary disclosure there was no liability and, therefore, there was no debt because the assessee had concealed his income, appears to be attractive at the first blush but then we think that the argument is not tenable for the simple reason that the concealed income is of the assessee. It is a different thing that the assessee did not make a disclosure of it but then it does not cease to be the assessee's income and, therefore, once it is accepted that it is the income of the assessee, the natural consequence followed and that it is the tax liability created because of the disclosure. Therefore, we hold that there was already tax liability and that the assessee was under an obligation to pay and, therefore, it becomes an ascertained liability and having regard to the decision of the Supreme Court, the tax liability which is a debt has to be allowed, and, therefore, the Appellate Assistant Commissioner was fully justified in giving relief to the assessee.
Considering the facts and circumstances of the case, we uphold the order of the Appellate Assistant Commissioner giving relief to the assessee as debt owed by the assessee falling within the meaning of Section 2(m) of the Wealth-tax Act."
11. First, we take up question No. 1. The question for consideration is whether the Wealth-tax Officer gave effect to the order of the Commissioner of Wealth-tax as such, without doing anything more and whether he gave relief, not given or passed an order, not passed by the Commissioner of Wealth-tax. The Tribunal recorded a precise finding that the Commissioner of Wealth-tax simply gave a direction to the Wealth-tax Officer without giving any relief to the assessee and that the Wealth-tax Officer was directed to allow the claim as per law. The Tribunal concluded that on these facts and circumstances the order of the Wealth-tax Officer was not merely an order giving effect to the order of the Commissioner of Wealth-tax passed in revision under, Section 25(1), but the Wealth-tax Officer proceeded on his own as per law and, therefore, his order is appealable.
12. We find force in the reasoning of the Appellate Tribunal. If the Wealth-tax Officer had given effect to the order of the Commissioner of Wealth-tax passed in revision as such, without doing anything more, then it could be said that no order was passed by the Wealth-tax Officer, but he simply gave effect to the order of the Commissioner of Wealth-tax and, therefore, whatever remedy was available that was against the order of the Commissioner of Wealth-tax only. But the Tribunal clearly held that the Wealth-tax Officer was simply directed by the Commissioner of Wealth-tax to give relief to the assessee as per law, without giving any relief himself to the assessee. Therefore, we agree with the view taken by the Appellate Tribunal that the order of the Wealth-tax Officer on the facts and circumstances of the case, was appealable.
13. Then we turn to question No. 2. The assessee made disclosure under the disclosure scheme and agreed to several additions which spread over several years. The assessee then claimed income-tax liability having arisen on account of several additions, which he agreed to under the voluntary disclosure scheme. The contention of the Revenue was that before the voluntary disclosure, there was no liability and, therefore, there was no debt because the assessee had concealed his income. This objection was rejected by the Tribunal, which found that the "concealed income of the assessee does not cease to be the income of the assessee. It is a different thing that the assessee did not make a disclosure of it but then it does not cease to be the assessee's income and, therefore, once it is accepted that it is the income of the assessee, the natural consequence that followed is that the tax liability is created because of the disclosure".
14. We do not find any legal infirmity in the above finding of the Appellate Tribunal.
15. On these facts, we answer both the questions referred to us for our opinion in the affirmative, i.e., in favour of the assessee and against the Revenue.
16. The registry is directed to send down the record to the Appellate Tribunal within fifteen days from today, which may then pass a necessary order to dispose of the case conformably to our judgment.