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2014 (7) TMI 10 - GUJARAT HIGH COURTNon-disclosure of income - levy of tax @ 60% on salary income – Applicability of provisions of section 158BB(1)(c) of the Act - Whether non-disclosure of the income by not filing the return of income on which the TDS is deducted, whether the same can be treated as “undisclosed income” within the meaning of Section 158B(b) under Chapter XIV-B of the Act and for which the block assessment proceedings is permissible or not – Held that:- The Tribunal has committed a grave error in directing that the income earned by way of salary by the assessee cannot be treated as undisclosed income for levying tax at 60% on the salary income as undisclosed income – Following THE ASSISTANT COMMISSIONER OF INCOME TAX AND OTHERS, CHENNAI Versus M/s AR ENTERPRISES [2013 (1) TMI 345 - SUPREME COURT]. The tax to be deducted at source is computed on the estimated income of an assessee for the relevant financial year, such deduction cannot result into disclosure of the total income for the relevant assessment year and therefore, mere deduction of tax at source, doest not amount to disclosure of income, nor does it indicate the intention to disclose income most definitely when the same is not disclosed in the returns filed for the concerned assessment years - Non-disclosure of the income received by the assessee by way of salary was required to be treated as “undisclosed income” within the meaning thereof in Section 158B(b) under Chapter XIV-B of the Act liable to tax at 60% - Decided in favour of Revenue. Reduction of addition of unexplained investment – Held that:- At the time of search unexplained investment it was found and even after the search the assessee did not file the return of income and declared the same at the time of filing the return after the block assessment proceedings were initiated - the intention of the assessee is to be presumed that he was not to disclose the income and therefore, the same is required to be treated as undisclosed income within the meaning thereof in section 158B(b) under Chapter XIV-B of the Act - no specific reasons and/or evidence on record to reduce the addition on account of unexplained investment – the Tribunal has materially erred in reducing the addition on account of unexplained investment – Decided in favour of Revenue.
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