TMI Blog2004 (2) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... ed income. There is no infirmity or violation of principles of natural justice - Tribunal is correct in law in holding that the amount of Rs. 22 lakhs constitutes income in the hands of the appellant and others - - - - - Dated:- 23-2-2004 - Judge(s) : R. V. RAVEENDRAN., H. BILLAPPA. JUDGMENT The judgment of the court was delivered by R.V. RAVEENDRAN J.-This appeal by the assessee is against the order of the Income-tax Appellate Tribunal, Bangalore Bench, dated September 29, 2003, in I.T. (55) A. No. 54/Bang of 2002 relating to the block period 1990-91 to 1999-2000. The Assessing Officer passed a block assessment order dated June 25, 2001, under section 158BC of the Income-tax Act, 1961 ("the Act" for short), in pursuance of a se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in law in holding that the amounts have to be assessed in the hands of respective persons without hearing such persons? (iii) Whether the Tribunal is justified in law in holding that the appellant is liable to be assessed for income of Rs. 2,00,000 on account of deficit stock?" Re. : Question No. (i) Section 158BG provides that no order of assessment for the block period shall be passed by the Assessing Officer without the previous approval of the Joint Commissioner in respect of a search initiated under section 132. The assessee contends that before granting previous approval under section 158BG for an order of assessment made under section 158BG, the Joint Commissioner should have given a hearing to the assessee. It is submitted th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f an appeal under section 246A where also he is heard. There is no need, therefore, for the Joint Commissioner to give a hearing before giving previous approval under section 158BC. Firstly, the statute does not provide for such a hearing; secondly, the principles of natural justice also do not require such a hearing having regard to the fact that the assessee gets a hearing before the assessment and also a hearing if he files an appeal against the order of assessment; and thirdly, the order passed by the Joint Commissioner granting previous approval under the proviso to section 158BG is in exercise of administrative power on being satisfied that the order of assessment has been made in accordance with the provisions of Chapter XIV-B. The p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion No. (ii) A sum of Rs. 22,00,000 was added by the Assessing Officer to the income of the assessee as undisclosed income by way of interest. The Commissioner of Income-tax (Appeals) confirmed the same. The Tribunal held that the said interest was earned on the amount financed to M/s. Balakrishna group. It was held that the assessee had financed M/s. Balakrishna group through his own funds, the funds of his Hindu undivided family and the funds of his daughter-in-law's proprietary concern (Praveen Textiles). The assessee had admitted in his statement recorded on July 13,1999 (date of search), that a sum of Rs. 22 lakhs was received as interest on the following lending: Rs. 2S lakhs advanced by cheque by M/s. Praveen Textiles (of which th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... finding of fact arrived at on the admission made by the assessee on July 13, 1999, which was duly recorded. The admission is not disputed. Nor has the assessee subsequently demonstrated that the admission is incorrect. Therefore, we find no reason to interfere with the finding that Rs. 22 lakhs is the undisclosed income. The further finding that the entire sum of Rs. 22 lakhs is not the undisclosed income of the assessee alone, but of the assessee, his Hindu undivided family and his daughter-in-law is a finding beneficial to the assessee, as otherwise the assessee would have to bear the tax and other burdens relating to the entire undisclosed income of Rs. 22 lakhs. The Tribunal has now restricted the liability of the assessee to his por ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rsons concerned, that is the assessee's Hindu undivided family and the assessee's daughter-in-law. There is no basis for the assumption that the Tribunal has directed the Assessing Officer to assess the balance of the interest amount in the hands of third parties without giving them an opportunity of hearing. Hence, the second question does not arise for consideration at all. Re : Question No. (iii) The third question relates to the liability of the assessee to be assessed for the income of Rs. 2,00,000 on account of deficit stock. This is purely a question of fact. Learned counsel for the assessee fairly conceded that the said issue did not involve any question of law, much less substantial question of law. The appeal is, therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X
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