2016 (9) TMI 66

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....d having perused the record, it appears that the disputed amount of Rs. 1.76 crores (rounded off) which the Assessing Officer wanted to tax in the hands of the assessee, was already offered to tax by group companies before the Settlement Commission. Such declarations were accepted by the Settlement Commission. The Assessing Officer, however, questioned the assessee about such amount being directly introduced in the capital account without routing through P & L account. The Assessing Officer rejected the contentions of the assessee that such amount cannot be taxed in the hands of the assessee either on the basis of accrual or receipt and, in any case, the same having been taxed by the Settlement Commission cannot be taxed again. The Assessin....

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....ess concerns for the same block period including same regular assessments till A.Y. 2003-04. It is thus evident from the record that the undisclosed income available at Dubai was received/accrued and earned before the date of search. Thus, the amount transferred by the appellant was out of the undisclosed income earned before the date of search. The business concerns had paid most of the due taxes on that undisclosed income during the course of proceedings before the Settlement Commission. The appellant had transferred the amount from Dubai just about a month before the order dated 28.03.2006 of the Settlement Commission and by that time taxes of Rs. 1,50,00,000/- were paid by the company Ajanta India Ltd. on 03.01.2005 which belonged tot h....

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.... concerns, the same income cannot be subject to tax on application of income. It amounts to double taxation. Thus, the transferred amount cannot be subject to tax again as income of the appellant. 3.9 Considering the above discussion in para 3.2 to 3.8 above, it is held that the Assessing Officer was not justified in taxing the transferred amount of Rs. 1,76,71,570/- from Dubai in the hands of the appellant either on receipt/accrual basis or on the basis of deemed income. Otherwise also, the taxes on the undisclosed income available at Dubai were paid by the business concerns and by taxing the transferred amounts again in the hands of the appellant will tantamount to double taxation. On this aspect also, the income was not liable to be tax....