TMI Blog2001 (2) TMI 127X X X X Extracts X X X X X X X X Extracts X X X X ..... loan from a limited company under the Companies Act, 1956, who is also an assessee under the said Act, 1961. There had been search and seizure resulting in block assessment of the assessee. During the block assessment, the assessee was called upon to explain the advance taken, the assessee has filed the confirmation letter of loan including its income-tax file numbers of the creditor of the limited company which advanced the loan to the assessee. The authority, however, being not satisfied with such explanation wanted details of the persons from whom the money was taken by the said limited company without reopening the assessment with regard to the said limited company and ultimately held that the said loan was a fictitious one and was t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the circumstances of the case, the Tribunal has any material to justify its finding and conclusion that the assessee has failed to discharge the onus to prove the genuineness of the said loan creditor amounting to Rs. 50,000 by endorsing the view of the Assessing Officer that the loan creditor was used only as shadow company and the money had come from some individual who had no means to advance the money ? 3. Whether, on the facts and in the circumstances of the case, the Tribunal relied on irrelevant materials and ignored relevant evidence in holding that the sum of Rs. 50,000 was the income of the assessee from undisclosed sources for the said block period on the alleged ground of failure of the assessee to prove the source of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer is still empowered to question the loan while passing the block assessment irrespective of the fact that the same income is assessable in regular assessment. Statutory interpretation means the process by which the courts seek to ascertain the meaning of the Legislature through the medium of authoritative forms in which it is expressed. Interpretation differs from construction. In view of the former is of finding out the true sense of any form and the other is the drawing of conclusion respecting subjects that lie beyond the direct expression of the text. A statute is a creature of the Legislature. Every statute has its preamble, it has objects and reasons for which it was enacted. To find out the correct meaning of a particul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t High Courts on this issue. Hence, we are in total agreement with Shaw Wallace and Co. Ltd.'s case [2001] 248 ITR 81 (Cal) where the Division Bench has held that the said Explanation is nothing but clarificatory which was necessitated because of the divergent views. In fact the Explanation to section 158BA has started with these words "for the removal of doubts" so the doubt expressed by different High Courts are removed by incorporating the said Explanation. Now the question comes what does this Explanation mean. Clause (a) of the Explanation makes it clear that the block assessment is in addition to the regular assessment in respect of each previous year included in the block period ; (b) means total undisclosed income relating to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oot of the matter and the other is on the basis of the causes shown by the assessee where the Assessing Officer is free to accept the justification shown or reject the same. The said two types of cases cannot be treated at par. Hence, we hold that the Assessing Officer was not entitled to question the said loan in block assessment which is a subject-matter of the regular assessment. Hence, the Assessing Officer was wrong in holding that the said sum can be taxed in block assessment although the same featured in the regular books of account. Similarly, the Tribunal also committed error in upholding the decision of the Assessing Officer. As the loan creditor is an assessee under the Act of 1961 in whose assessment the loan advanced had b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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