Wp/19563/1999 Of M/S. City Auto Agencies v. Commissioner Of Income-Tax

IN THE HIGH COURT OF JUDICATURE, ANDHRAPRADESH AT HYDERABAD THURSDAY, THE FIFTH DAY OF DECEMBER TWO THOUSAND AND THIRTEEN PRESENT THE HON’BLE THE CHIEF JUSTICESRI KALYAN JYOTI SEN GUPTA AND THE HON'BLE SRI JUSTICE SANJAY KUMAR WRIT PETITION No.19563 OF 1999 Between: M/s. City Auto Agencies,Augunagar, PH NO. 915,6[th] Block, 2[nd] Cross Road,Vijayawada, Rep. by its Managing PartnerMr.Ch. Vijay Mohan ..... Petitioner AND Commissioner of Income Tax,Vijayawada and others .....Respondents The Court made the following : ORDER:(per the Hon’ble Sri Justice Sanjay Kumar) This writ petition was filed assailing the order dated 05.01.1999 passed by the Commissioner of Income Tax,Vijayawada, under Sec. 264 of the Income Tax Act, 1961. The assessee/writ petitioner is a firm carrying on thebusiness of distribution of automobile components madeby various manufacturers. In respect of the assessmentyear 1995-96, it filed a return of income on 30.10.1996.After filing of the return, the petitioner firm filed adeclaration under the Voluntary Disclosure of IncomeScheme, 1997, offering Rs.1,50,000/- as undisclosedincome. This income was shown as an excess debit in itsTrading Account with a corresponding credit entry in theaccount of M/s. Punjab Bevel Gears Limited. Thereupon,the Commissioner of Income Tax, Vijayawada, issued acertificate under Sec.68(2) of the Scheme of 1997accepting the income declared by the petitioner firm andrecording that the tax payable thereon at Rs.52,500/- wasduly paid. While so, the Assessing Officer, whileprocessing the return filed by the petitioner firm for theassessment year 1995-96, held that this sum ofRs.1,50,000/- was liable to be added to the income andthat the assessee was due and liable to pay a further sumtowards tax. Aggrieved by this action of the Assessing Officer,the petitioner firm filed an application before theCommissioner of Income Tax, Vijayawada, under Sec.264 of the Income Tax Act, 1961. By the order underchallenge, the Commissioner rejected the plea of the petitioner firm and upheld the assessment order. Hence,this writ petition. The petitioner firm had offered a sum ofRs.1,50,000/- shown as an excess debit in its TradingAccount after filing its return for the Assessment Year1995-96. This undisclosed income was offered andaccepted under the Voluntary Disclosure of IncomeScheme, 1997. The Assessing Officer however includedthe very same income in the regular assessment order.This action amounted to taxing the petitioner twice for thesame income. Despite this fact being brought to hisnotice, the Commissioner of Income Tax, Vijayawada,failed to exercise jurisdiction under Sec.264 of the IncomeTax Act, 1961. The order dated 05.01.1999 passed by theCommissioner of Income Tax, Vijayawada, is accordinglyset aside and it is made clear that the petitioner firm wouldnot be liable to suffer tax once again on the income ofRs.1,50,000/- offered and accepted under the VoluntaryDisclosure of Income Scheme, 1997. The writ petition isallowed. Interim applications, if any, shall stand closed. Nocosts. ______________________ Kalyan Jyoti Sengupta, CJ. ______________ Sanjay Kumar, J.