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2014 (2) TMI 1118 - HC - Income TaxSearch u/s 132 of the Act - Block Assessment – Reference made to DVO for valuation u/s 133(6) of the Act - Notice under Section 158-BD of the Act issued – Held that:- During the course of search, no incriminating documents were traced – As on the date of search, the building was not completed and there was no income from the building - There was no positive comments from the DVO with regard to suppression of material facts by the assessee which would amount to undisclosed income - The difference in the cost of construction cannot constitute undisclosed income for the block period - On verification of the revised report submitted by the DVO, the differences between the valuation of the assessee- Firm and the DVO is less than 15% - There is no specific finding by the Assessing Officer with regard to any concealment - there was no material found during the search indicating that there were expenses incurred on construction by the assessee that were not recorded in the books of accounts - In the absence of any seized material and solely on the basis of the report of the DVO, there cannot be any finding with regard to the undisclosed income - No material has been found at the time of search for initiating proceedings under Section 158-BD of the Act. Rectification of mistake u/s 154 of the Act – Held that:- Solely on the basis of the Valuation report, block assessment cannot be made - it is not open to the appellant to tax again in the guise of undisclosed income – Relying upon the decision in the case of M/s. Hotel Blue Moon [2010 (2) TMI 1 - SUPREME COURT OF INDIA]- the undisclosed income unearthed as a result of search - The scope and its ambit is limited in that sense to materials unearthed during the search - The Appellate Authority as well as the Tribunal after considering the matter in detail corrected the mistake committed by the Assessing Officer – thus, there was no infirmity or irregularity in the order passed by the Appellate Authority and the Tribunal – Decided against Revenue.
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