Kar Vivad Samadhan Scheme settlement bars reopening of the same assessment once the certificate is issued, absent false declaration

Tax arrears settled under the Kar Vivad Samadhan Scheme, once the declaration is accepted, the amount determined is paid, and the certificate is issued, attain statutory finality and immunity from further reopening for the same period. Reassessment or continuation of proceedings under section 155 is impermissible unless the statutory exception for false particulars in the declaration is attracted. The court held that the attempted reopening could not stand and restored finality to the settlement in favour of the assessee.

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Issues: Whether an assessment could be reopened after the assessee had settled the tax arrears under the Kar Vivad Samadhan Scheme and obtained the certificate, and whether the proceedings under section 155 of the Income-tax Act could continue.

Analysis: The Scheme contemplated a considered determination of tax arrears and, upon payment of the amount determined, the statutory immunity became operative. Once the declaration was accepted, the amount was paid, and the certificate was issued, there was no justification to reopen the assessment for the same period except in a case falling within the statutory exception relating to false particulars in the declaration. The order reopening the assessment, therefore, could not stand.

Conclusion: The reopening of the assessment was impermissible and the challenge succeeded in favour of the assessee.

Final Conclusion: The appellate court set aside the order under challenge and restored finality to the settlement reached under the statutory scheme, granting relief to the assessee.

Ratio Decidendi: Once tax arrears are settled under the Kar Vivad Samadhan Scheme and the certificate is issued, the assessment for that period cannot be reopened unless the statutory exception for false declaration is attracted.

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