1999 (8) TMI 18 - HC - Income Tax

Summary

Issues Involved:
The main issue in this case is whether the Assessing Officer can proceed with regular assessment under section 143(3) of the Income-tax Act, 1961, when there is a pending assessment under Chapter XIV-B of the Act for undisclosed income in a block period.

Summary:
The appellant challenged the order of the learned single judge for not staying the operation of the notice u/s 143 of the Income-tax Act, 1961, while the assessment for the year 1998-99 u/s 158BC was pending. Notices u/s 143(2) were issued to the appellants for regular assessment. The appellant argued that since there was a search and a notice u/s 158BC was issued covering the same period, no parallel proceedings for regular assessment should take place. The Department contended that regular assessment can proceed for disclosed income even if there is a pending assessment for undisclosed income u/s 158BC. The Court noted that Chapter XIV-B deals with undisclosed income, while section 143(3) is for disclosed income, allowing both proceedings to run simultaneously. The Court ruled that income assessed under section 143(3) cannot be taxed again u/s 158BC, allowing both proceedings to continue concurrently. The Assessing Officer was directed not to assess undisclosed income in the regular assessment that is part of the proceedings u/s 158BC. The appeal and application were disposed of with these observations.