9911796707
TMI Blog2003 (10) TMI 298X X X X Extracts X X X X X X X X Extracts X X X X ..... undisclosed income of Rs.3,06,990 from the block assessment when the facts of the case reported in (2001) 168 CTR (Bom) 506 : (2001) 249 ITR 501 (Bom) are distinct from the facts of the case." 3. Briefly stated, the facts of the case are that the assessee is a partner in the firm M/s Zain Corporation. A search under s. 132 of the IT Act, 1961, was conducted at the residential premises of the assessee as well as business premises of the above firm on 16th March, 1999. Therefore, a notice under s. 158BC was issued to the assessee on 16th June, 1999, in response to which return for the block period, i.e., 1st April, 1988 to 16th March, 1999, was filed on 4th Aug., 1999, declaring nil undisclosed income. However, the AO computed the undisclose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reated as undisclosed income. Reliance was placed on the decision of the ITAT, Pune Bench in the case of Vidya Madanlal Malani vs. Asstt. CIT (2000) 69 TTJ (Pune) 456 : (2000) 74 ITD 341 (Pune). However, for the detailed reasons given in the assessment order, the AO did not accept the above contention of the assessee and made the impugned addition. During the course of appellate proceedings before the CIT(A), the assessee also filed a copy of statement of income and tax audit report of M/s Zain Corporation, which was filed along with the return of the firm on 31st Oct., 1998, wherein the annex. II & III of the tax audit report following payments were shown to the partners: "Annexure II Clause No. 5: Particulars of all payments made to p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e for asst. yr. 1998-99 within the time-limit under s. 139(1) and ordinarily the disclosed income for asst. yr. 1998-99 could have been taken as nil under s. 158BB(i)(c), yet such income cannot be taken as undisclosed income of the appellant under s. 158B(b) considering the fact return of the firm from which salary and interest income have been received by the appellant was filed before the due date under s. 139(1) and prior to search action and the payment made to partners by way of interest and salary was disclosed in the tax audit report as well as statement of income of the firm. On similar facts in the case of Shamlal Balram Gurbani, Hon'ble Bombay High Court has held as under: "On verification of the record, it was found that the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting the said total income as undisclosed income for the purposes of Chapter XIV-B, Under the above circumstances, the Tribunal allowed the appeal. We do not find any reason to interfere with the findings of facts recorded by the Tribunal." Accordingly, relying upon the above decision of Hon'ble Bombay High Court, the AO is directed to exclude from the undisclosed income of the appellant Rs. 3,06,990 since salary and interest from the firm including interest received by minor sons of the appellant exceed Rs. 3,06,990." 6. We have heard the learned representatives of both the parties and have also carefully gone through the orders of the authorities below. Sec. 158B(b)deals with "undisclosed income", which reads as under: "158B: In this c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent prior to search action. The Department was fully aware of this fact that the assessee had received interest and salary form M/s Zain Corporation. In fact, the Department had not found any incriminating material during the course of search and, as such, there was no justification in treating salary and interest income received by the assessee from M/s Zain Corporation as undisclosed income for the block period. In our view, the learned CIT(A) has rightly deleted the addition in view of the decision of the Hon'ble High Court in the case of CIT vs. Shamlal Balram Gurbani and in that view of the matter, we decline to interfere with his order. The appeal is without any merit and hence, deserves to be dismissed. 7. In the result, the appal i ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
