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1 - 10 of 14 (0.33 seconds)Commissioner Of Income Tax, Bhopal vs M/S. Shelly Products And Another on 8 May, 2003
The return of income filed by the petitioner on 10.09.1996, pursuant to the notice under Section 158 BD of the Act, without payment of tax, was not valid in the eye of law. Therefore, any amount paid by the petitioner was not based on any valid return of income . Once the assessment is annulled, no tax is chargeable on the total income returned by the assessee. Consequently, the full amount paid by the petitioner is liable to be refunded together with interest under Section 244. The entire tax was paid only pursuant to the demand and recovery action by the Department and not paid with the return and therefore, the tax paid is not covered by the proviso under Section 240. The decision of the Hon'ble Supreme Court relied on by the Revenue in the case of CIT vs Shelly Products and another, reported in 261 ITR 367, is distinguishable on facts and thus, the same would not apply to the present case. The tax paid in cases of tax chargeable on total income returned by the assessee would not apply for undisclosed income returned by the assessee. The term "total income" and "undisclosed income" are totally different. Merely because the petitioner declared certain income, the same cannot be termed as undisclosed income, unless the order of block assessment stands the test of validity, which, in this case, failed. Therefore, the entire tax payment should be refunded along with interest.