TMI Blog2008 (10) TMI 326X X X X Extracts X X X X X X X X Extracts X X X X ..... - Therefore, a direction issued by the Tribunal preventing the Assessing Officer from scrutinizing the accounts of the above entities while assessing the income of the respondent does not appear to be valid in law and not based on any material on record. Hence, the Assessing Officer is entitled to go into the accounts of the said entities to find out whether the income of the said entities have any nexus with the income of the respondent to fasten the tax liability, if any, on the respondent-assessee - 247, 240 and 245 of 2003 - - - Dated:- 14-10-2008 - K. SREEDHAR RAO and C. R. KUMARASWAMY JJ. I. T. A. No. 247 c/w I. T. A. Nos. 240 and 245 of 2003 M. V. Seshachala for the appellant. D. L. N. Rao and Smt. S. R. Anuradha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reaction to the search, had disclosed the income of the firm In Corps Associates (ICA, for short) a partnership firm of which K. Venkatesh Dutt (KVD, for short) is a managing partner, and his father, K S. Dattatreya (KVD, for short)) as his income in the revised return. It is, therefore, submitted that the revised return is to be rejected as time barred and that the income disclosed in the revised return does not really pertain to him. It was also contended by the assessee that the income of the firm and KSD in the hands of the assessee had been wrongly assessed as the income of the assessee for all the three years and that the Assessing Officer should not reckon the income of the firm and KSD as his income. The State submitted before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he blowing operative order at paragraph 13: "13. In view of our above finding and various decisions cited, we hold that: (a) The assessee is entitled to retract from his earlier settlement application as the same is against the express provision of law and is also erroneous. (b) The income of ICA, including its divisions, other credit entries in its books and other disallowances in respect of income of ICA is to be excluded while computing income of the assessee for all the years under appeal. (c) From the assessment order, it is seen that the income is computed based on computation filed in settlement petition (as reproduced in para 4.4 above). The Assessing Officer shall, therefore, exclude the credits of Rs. 1.40 crores, Rs. 83.8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessed in the hands of the assessee or not when the assessment order itself had been set aside and the entire matter was before the Assessing Officer for consideration afresh as the particulars available when passing the original assessments were not sufficient? (3) Whether the Tribunal was correct in proceeding to entertain the cross-objections and permitting the assessee in the said proceedings for the first time to withdraw his earlier admission and concession that the income declared by him did not belong to him but to certain other entities without basing these conclusions on any cogent material and consequently recorded a perverse finding? (4) Whether the Tribunal was correct in holding that the income which had been originally in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd that the income of the said entities cannot be considered as income of the assessee. The Tribunal in operative portion of the order further went on to hold that the Transcorp Associates-Delhi, Megacorp-Bombay and Intercorp-Bombay should not be computed as the income of the assessee and the income of the said firm to be excluded from the scrutiny while assessing the income the assessee. 13. On a thorough consideration of the order of the Tribunal it is found that far income of KSD and ICA is concerned, the Tribunal had the benefit of going through the accounts of the said entities to come to the conclusion that the income reflected in the revised returns of the assessee pertains to those entities. However, no material in respect of M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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