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2018 (8) TMI 1434 - HC - Income TaxReopening of assessment - reason to believe - protective assessment made - assessee had declared the income under the income tax declaration scheme 2016 - genuineness of share application money - AO had no information at his command to come to the conclusion that the investment owned up and declared by Garg Logistics Pvt Ltd. was not from the funds of the said declarant but was in fact, the unaccounted income of the assessee company. Held that:- Quite apart from impermissiblity of casting such burden on the assessee, we wonder at which stage would the assessee discharge such burden. Return was accepted without scrutiny. Before issuing impugned notice, no information was called from the assessee by the Assessing Officer. The reasons so recorded simply lack validity. - The conclusions are based on surmises and conjectures which are not permissible in law and not backed by any material on record. This is so for an amount of ₹ 6.25 crores of share capital investment. Scope of income tax declaration scheme 2016 - The Scheme thus makes detailed provisions for declaration of income which hitherto was either undisclosed or not charged to tax. Upon such declaration being accepted, declarant would pay tax at the prescribed rate with surcharge and penalty. Upon such amounts being paid, declarant would receive certain immunities. The income so declared would not be included in the total income of any assessment year. Even Benami transactions would not be targeted. The scheme thus appears to have been framed to encourage disclosures of unaccounted income. Upon acceptance of such disclosure, Revenue would collect tax, surcharge and penalty at the prescribed rates. In turn, the declarant would have peace of mind and certain immunities. In the present case, same amount which the Assessing Officer wishes to tax in the hands of the petitioner company by resorting to reopening of assessment was declared by Garg Logistics Pvt Ltd. under such declaration. Declaration was accepted by the competent authority pursuant to which Garg Logistics Pvt Ltd. in three installments also deposited the entire amount of tax with surcharge and penalty. Any attempt on part of the Assessing Officer to assess the same income in the hands of assessee would amount to charging the same income twice. It can thus be seen that upon an assessee in whose hands the income is charged, files a declaration, the protective assessment in hands of another assessee would automatically abate, clearly indicating the intention of charging tax on the same income only once. - Decided in favor of assessee.
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