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2012 (5) TMI 18 - KERALA HIGH COURTQuestion of law - Order of the tribunal cancelling assessment - Block assessment - Search and seizure - assessment based on evidence - held that:- the contention raised by Senior counsel for the Revenue is that when assessment of undisclosed income is based on concrete evidence received from the documents and accounts seized from the residence of assessee and the film distributor above referred, the Tribunal's refusal to uphold the assessment without any basis or material is a perverse finding which gives rise to a question of law. We find force in this contention because when block assessment of any item is made based on evidence collected in the course of search, the assessment under Section 158BC read with Section 158BD is supported by statutory provision namely, Section 158BB of the Act. The Tribunal cannot cancel the assessment of undisclosed income if the same is based on tenable and acceptable evidence recovered in the course of search and which is not disproved by the assessee. - Decided in favor of revenue. Block assessment - AO computed undisclosed income movie-wise and the basis of addition is that the film distributor namely, Sri.P.D.Abraham of Swargachitra Films for whom assessee produced the film, has accounted payment of higher amount than what is shown as received by the assessee in his books of accounts. - held that:- The assumption by the C.I.T.(Appeals) as well as by the Tribunal that without the confirmation statement by the assessees undisclosed income cannot be assessed based on evidence gathered on search is wholly unrealistic and contrary to statutory scheme for assessment of undisclosed income under Chapter XIV B of the Act. We, therefore, set aside the order of the Tribunal and that of the first appellate authority and restore the addition of Rs.10 lakhs being the undisclosed income from the film "Manathevellitheru". Regarding addition of Rs. 10 lakhs - held that:- The first appellate authority as well as the Tribunal deleted the addition by stating that assessee has not given statement to corroborate the unaccounted income. We do not know what more evidence is required other than the clandestine account received from the assessee - Decided in favor of revenue. No other ground raised by the Revenue gives rise to any substantial question of law. In the result, we allow the appeal in part by sustaining a total addition of Rs.22,20,959/- and confirming the order of the Tribunal cancelling the balance addition of Rs.78,64,811/-.
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