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2020 (8) TMI 193 - AT - Income TaxDenial of refund of tax paid by the assessee while filing the return of income u/s 158BC - block assessment - refund u/s 240 is only in respect of the amount which has resulted due to the addition made by the AO during the assessment - main contention of the assessee is that once the assessment is quashed by the Hon'ble High Court, the tax paid by the assessee on the income declared in the return of income filed in response to notice u/s 158BC also becomes refundable - HELD THAT:- In case of block assessment where the initiation of proceedings are quashed, the judgment of the Hon'ble Supreme Court in case of Shelly Products [2003 (5) TMI 4 - SUPREME COURT] is applicable and consequently the refund of tax is limited only to the extent of the tax liability due to the addition made by the AO and not the tax paid by the assessee on the income declared by it while filing the return in response to notice under section 158BC. Declaration of income in the return filed by the assessee is a voluntary act and admitted by the assessee which cannot be retracted subsequently only because the initiation of proceedings under section 158 BC were quashed by the High Court due to technical defect in the notice issued under section 158BC. We have already noted that the return of income was filed by the assessee after 20 days of the notice issued under section 158 BC and, therefore, the mandatory period as provided under section 158BC was availed by the assessee in filing the return of income. Once the return of income was a valid return and there was no bonafide or apparent mistake in the said return, then the tax paid on the income declared in the return is not refundable in view of clause (b) of proviso to section 240 of the IT Act. Accordingly, the appeal of the assessee has no merit.
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