Commissioner Of Income Tax vs Mrs. Kumkum Kohli
2005 Latest Caselaw 726 Del

JUDGMENT

Swatanter Kumar, J.

1. Vide order dt. 19th April, 2002, the Tribunal held as under :

"After hearing both the parties, we find that the issue is squarely covered in favor of the assessed by the decision of the Tribunal in the case of Vidya Madan Lal Malani (supra) wherein it has been held that if the income returned by the assessed is from disclosed sources then no addition can be made on account of undisclosed income under Chapter XIV-B merely on the ground that the return of such income was not filed before the date of search. This view also finds support from the decision of the Hon'ble Bombay High Court in the case of Sham Lal Balram Gurbani (supra). The statement of assessable income of the assessed for asst. yr. 1995-96 shows that assessed had income by way of capital gain amounting to Rs. 23,05,357 against which the assessed had paid advance tax of Rs. 4,50,000 on 31st March, 1995, i.e., much before the date of search and, therefore, it cannot be said that assessed would not have disclosed such amounts. It is further seen that the return filed later on has been accepted by the AO under Section 143(3). Considering these factual aspects Along with the case relied upon by the learned counsel for the assessed, it is held that the sum of Rs. 23,05,357 pertaining to asst. yr. 1995-96 could not be assessed as undisclosed income. Accordingly, this addition is hereby deleted.

7. In the result, appeal of the assessed is partly allowed."

2. These findings are challenged by the Revenue in the present appeal under Section 260A of the IT Act (hereinafter referred to as the Act) on the ground that under the provisions of Section 158B of the Act, the said amount of Rs. 23,05,357 would have to be treated as undisclosed income and would be liable to tax under Section 158BC, Clause (c) of the Act @ 60 per cent. The findings, to the contrary, are opposed to the presumption of law available in favor of the Revenue under Section 158B of the Act. A search and seizure operation in terms of Section 132 of the IT Act was conducted at the residential premises of the assessed on 15th Sept., 1995. Notice was issued to the assessed for filing IT return as certain documents were seized during this operation. Besides other items, the AO vide his order dt. 30th Sept., 1996, treated the undisclosed income of Rs. 26,92,532. The order of the AO was challenged by the assessed. The Tribunal while dealing with the questions raised, the addition for the block period was reduced to Rs. 2,75,227 in regard to the asst. yr. 1995-96. It was noticed in the impugned order that addition of Rs. 23,05,357 was without any basis and there is no discussion in the order of assessment except to the extent that the return was not filed within time.

3. From the findings recorded by the Tribunal, it is clear that the assessed had paid the advance tax of Rs. 5,50,000 on 31st March, 1995, for the asst. yr. 1995-96, i.e., much before the date of search. This factual aspect viewed in light of the fact that the AO accepted the return filed by the assessed for that very assessment year and accepted the return declaring an income of Rs. 23,05,360 which was filed on 4th May, 1996. This assessment was finalised by the AO on 28th Nov., 1997, after issuing notice to the assessed under Section 143(2) of the Act and hearing the assessed. In the statement of assessable income filed by the assessed, the figure of Rs. 23,05,360 was duly reflected in the accounts.

4. From the above facts appearing on record before us, it is clear that finding of the Tribunal does not call for any interference by this Court in exercise of jurisdiction under Section 260A of the Act. The provisions of Section 158B of the Act would not be attracted in the present case inasmuch as nothing has been recorded in the order of assessment or in any proceedings thereafter, that the amount had not been indicated in the books of account or that the assessed had failed to produce the books of account, as directed by the AO. The presumption against the assessed could be drawn only if the sums wholly or partly had not been reflected in the books or the assessed had failed to render explanation in terms of the said provisions. Here the assessed had paid the advance tax and has also shown the figure in his accounts submitted before the AO.

5. For the reasons aforestated, we are of the opinion that no question of law much less a substantial question of law arises in the present appeal, the same is dismissed by leaving the parties to bear their own costs.