TMI Blog2001 (12) TMI 53X X X X Extracts X X X X X X X X Extracts X X X X ..... 1995. The Assessing Officer completed the assessment, determining the total undisclosed income of the block period at Rs.7,22,232. As the assessee had not previously paid tax, no deduction was allowed from the income of the assessee. Aggrieved by the assessment under undisclosed income of Rs.7,22,232, the assessee preferred appeal before the Tribunal. Before the Tribunal, the assessee raised many contentions. One of the contentions was that the Assessing Officer was not correct in including the income below the taxable limit as the undisclosed income for the purpose of assessment under section 158BC. Since the income for the years 1986-87 and 1987-88 was below the taxable limit, the assessee was not required to file the return of the income. This contention was accepted by the Tribunal. The Tribunal also allowed certain other deductions and directed the Assessing Officer to look into the matter. The Revenue has referred the question with regard to the non-inclusion of the income of the above two years for assessment. From the assessment order, the following is revealed: ------------------------------------------------------------------------------- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5,000.00 Business income 50,000.00 Undisclosed income ----------- 55,000.00 Assessment year 1994-95: House property income 5,000.00 Business income (shortage in cash flow) 3,22,888.00 ------------ 3,27,888.00 Less : Depreciation lorry (cost Rs.35,000) 17,500.00 Undisclosed income ----------- 3,10,388.00 Assessment year 1995-96: ------------ House property income ----------- 5,000.00 Business income 84,000 Less : Depreciation 8,750 ----------- 75,250.00 Undisclosed income ---------- 80,250.00 Assessment year 1996-97: (up to 22-11-1995) House property income ------------ 5,000.00 Business inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e or thing or any income based on any entry in the books of account or other documents or transactions, where such money, bullion, jewellery, valuable article, thing, entry in the books of account or other document or transaction represents wholly or partly income or property which has not been or would not have been disclosed for the purposes of this Act". Assessment regarding undisclosed income is dealt with by section 158BA of the Act. Section 158BA(2) of the Act says that the total undisclosed income relating to the block period shall be charged to tax, at the rate specified in section 113, as income of the block period irrespective of the previous year or years to which such income relates and irrespective of the fact whether regular assessment for any one or more of the relevant assessment years is pending or not. Section 158BB deals with computation of undisclosed income of the block period. It says that the undisclosed income of the block period shall be the aggregate of the total income of the previous years falling within the block period computed in accordance with the provisions of Chapter IV, on the basis of evidence found as a result of search or requisition of books ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee would be less than the assessable income, that income should not be taken into consideration for the purpose of total income, as that would be against him. Learned counsel also brought to our notice Form No. 2B, which is the relevant form for block assessment. In Note 5 to Form No. 2B, it is stated thus "Give the details in respect of the previous year on the basis of assessment order if the assessment/prima facie adjustment has been completed. Else, give the details on the basis of return of income filed. For the previous year which has not ended or for which the date of filing of the return under section 139(1) has not expired and that you are in a position to prove to the satisfaction of the Assessing Officer that such income or the transactions relating to such income have been recorded in the books of account and documents maintained in the normal course, such income is to be indicated against that previous year. For any year, if the return has not been furnished for the reason that the taxable income was not above the maximum amount not chargeable to tax, the total income is to be mentioned against that previous year." According to us, the note does not state as cont ..... X X X X Extracts X X X X X X X X Extracts X X X X
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