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2013 (8) TMI 635 - ALLAHABAD HIGH COURTSearch u/s 132 of the Income Tax Act - Block assessment - Addition on account undisclosed investment based on diary of the assessee - Held that:- The Assessing Officer has made the addition in this case on the basis of the diary as if the assessee has advanced money to the farmers. The money so advanced will tantamount to be the investment made by the assessee which can be added only under section 69 in the year in which the advance has been made if it is undisclosed income of the assessee as defined u/s 158B(b). Therefore, we do not agree with the finding of the CIT(A) that computation of the income of a particular Assessment Year within the block period is not relevant. In our opinion, the income has to be first computed in a particular assessment year. If the income will not fall in a particular Assessment Year, it cannot form part of the undisclosed income. Assessee was asked to verify from the DR whether entries in Annexure A-10 were duly recorded in books of account. The D.R. after several sitting with the assessee filed written submissions and reiterated the findings of the Assessing Officer, at the outset, that the assessee has not maintained the regular books of accounts for the assessment year 1998-99, ignoring the fact that the assessment for the assessment year 1998-99 was completed under Section 143 (3). The A.R., however, could not explain the amount of Rs.10,000/-, Rs.15,000/-, Rs.7100/- and Rs.5000/- totalling Rs.1,27,100/-, which was not entered in the regular books of accounts and which was treated as undisclosed income. The assessee had maintained account on computers and that notice in Register A-10 sufficiently explained the entries except an amount of Rs.1,27,100/-, which was treated to be undisclosed income found during the course of search – Decided against the Revenue.
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