9911796707
TMI Blog2014 (10) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... the sake of convenience, the parties are referred as the 1st appellant and the 2nd appellant. The facts, in brief, are as under: The appellants are individual and independent assessees. Incidentally, both of them are the shareholders of a company by name M.K. Securities Limited. They have been submitting returns year after year. A search was conducted on 24-01-1996 under Section 132 of the Income Tax Act, 1961 (for short, the Act) in the respective premises of the appellants. On the basis of the search, the block assessments for the period covering 1986-87 to 1996-97 were made. The 1st appellant admitted the undisclosed income of Rs. 26,0,9000/- and the 2nd appellant stated that he has undisclosed income of Rs. 3,96,000/-. However, both ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessing officer and the Tribunal have taken the correct view of the matter and no interference is warranted in the appeals. The proceedings are the result of a search made in the premises of the appellants. The search is so perfunctory that what has come out is in the form of declaration by the appellants themselves of certain amounts as undisclosed income viz., Rs. 26,00,900/- by the 1st appellant and Rs. 3,96,000/- by the 2nd appellant. Since the search was conducted on 24-01-1996, the block period is comprised of the assessment years 1986-87 to 1996-97. A perusal of the block assessment discloses that there was no discrepancy or disparity of facts and figures in relation to all the assessment years within the block, except the last ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be absorbed. Since the Act provides for the facility to be availed in the subsequent assessment years, they partake the character of unabsorbed loss or carried forward depreciation. The appellants pleaded that they have incurred losses in the assessment year 1996-97 in which the search was conducted and if the losses are taken into account, the undisclosed income virtually gets neutralised. That however did not weigh with the assessing officer as well as the Tribunal. Chapter XIVB, is virtually as a self-contained code. It prescribes the procedure to be followed whenever searches are conducted and the undisclosed income is discovered or found. To be fair to the assessee, the chapter provides for allowing all the deductions etc., as is don ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the character of the unabsorbed loss; it would not be available to them to be adjusted against the undisclosed income. The relevant provision reads: Section 158BB(4): For the purpose of assessment under this Chapter, losses brought forward from the previous year under Chapter VI or unabsorbed depreciation under sub-section (2) of section 32 shall not be set off against the undisclosed income determined in the block assessment under this Chapter, but may be carried forward for being set off in the regular assessments. Since the appellants did not file any returns for the assessment year 1996-97, it is difficult to straightaway conclude as to whether they had any unabsorbed loss to their credit. Another fact which needs to be taken into ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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