Double assessment of bank deposits cannot sustain reassessment when the same income is already taxed in another person's hands.

Reopening of assessment under the Income-tax Act was held unsustainable where the same bank deposits had already been assessed in the hands of another person for the same assessment year. On that factual basis, the department could not treat the identical deposits as the assessee's unexplained income, and the resulting addition could not be sustained. The reassessment was therefore quashed because the foundational material did not justify taxing the deposits again in the assessee's hands.

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Issues: Whether the reopening under section 147, read with section 144, of the Income-tax Act, 1961, could be sustained when the bank deposits in question had already been assessed in the hands of another person for the same assessment year.

Analysis: The assessee's deposit of Rs. 46,58,756 in an ICICI bank account was found to have already been assessed by the departmental authorities in the hands of another person for the very same assessment year. In view of this clinching factual position, the lower authorities could not treat the same deposits as the assessee's income liable to tax. The reopening, therefore, lacked a sustainable on these facts.

Conclusion: The reassessment was quashed and the addition based on the bank deposits was not sustainable against the assessee.

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