VDIS certificate protection bars second assessment of the same disclosed income unless the certificate is first recalled.

Income covered by a valid and subsisting Voluntary Disclosure of Income Scheme, 1997 certificate cannot be reassessed in the hands of another person once it has been accepted and taxed under the Scheme. The certificate under the Scheme operates to exclude the disclosed income from the declarant's total income for assessment purposes so long as it remains in force. If the certificate was procured by misrepresentation, the lawful course is recall of the certificate; absent such recall, a second assessment on the same income is impermissible. The Court therefore protected the assessee from repeat taxation of the disclosed income.

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Issues: Whether income already declared under the Voluntary Disclosure of Income Scheme, 1997 and covered by a certificate issued under that Scheme could again be assessed in the hands of an individual member of the HUF.

Analysis: The Scheme provided that once a declaration was made in accordance with Section 65, the Commissioner could issue a certificate under Section 68 setting out the voluntarily disclosed income and tax paid. On the certificate remaining in force, the disclosed income was not to be included in the total income of the declarant for any assessment year under the Income-tax Act. The Court held that once the same income had been accepted and taxed under the Scheme in the hands of one person, it could not again be taxed in the hands of another person. If the certificate had been obtained by misrepresentation, the proper course was to recall it, and no such step had been taken.

Conclusion: The income covered by the subsisting VDIS certificate could not be assessed again in the hands of the assessee. The question was answered in favour of the assessee and against the Revenue.

Ratio Decidendi: Income once validly covered by a VDIS certificate and taxed under the Scheme cannot be subjected to a second assessment in the hands of another person unless the certificate is first recalled in accordance with law.

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