TMI Blog2008 (4) TMI 306X X X X Extracts X X X X X X X X Extracts X X X X ..... return based on the books of account only – that year’s income to be included in block assessment - question is answered in favour of assessee - 215 of 1999 - - - Dated:- 4-4-2008 - C. N. RAMACHANDRAN NAIR and T. R. RAMACHANDRAN NAIR JJ. P. K. R. Menon for the Commissioner. P. Balakrishnan and R. Amritharaj for the assessee. JUDGMENT The judgment of the court was delivered by C. N. Ramachandran Nair J.- The reference case arises out of the order of the Income-tax Appellate Tribunal disposing of the respondent-assessee's appeal against the assessment under section 158BC of the Income-tax Act for the block period April 1, 1985 to December 27, 1995. A search was conducted in the premises of the assessee who is a medical p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... horise exclusion of returned income but only income seen as accounted in the books of account by the assessee at least on or before the date of search. 3. Learned counsel for the assessee, on the other hand, contended that there is no finding in the block assessment that the assessee has not recorded the amount in the books of account before the date of search and the assessment itself is based on the income returned in the return filed for the assessment year 1995-96. In order to appreciate the contentions, we have to refer to two provisions which are relevant for the disposal of this appeal. The same are extracted below : "158BA. Assessment of undisclosed income as a result of search.-. . . (3) Where the assessee proves to the sat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... date of the search or requisition relating to such previous years." 4. Both the above provisions provide for exclusion of income of the previous year for which the time for filing return was not over as on the date of search. In this case, even though the time for filing the return under section 139(1) was over, by virtue of general extension of time granted by the Central Board of Direct Taxes for filing the return for the assessment year 1995-96, the assessee had time till October 31, 1995, to file the return. In fact, the assessee had filed the return on the due date and what is added in the block assessment under challenge was the income returned by the assessee in the return for the assessment year 1995-96. The question is whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at least on the date of search is not tenable. Even though in principle we uphold the contention of the Revenue, we are not inclined to remand the matter for verification of the books of account pertaining to the search that took place more than 13 years back. In the absence of any finding by the Assessing Officer in the block assessment or by the Tribunal in the appellate order that the assessee has not entered the income returned for the year 1995-96 in the books of account or the transactions pertaining to the same in the books of account at least on the date of search and since the assessment is based on income returned, we have to assume that the assessee filed the return based on the books of account only. 6. In the above view of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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