2005 (1) TMI 49 - HC - Income Tax

Block assessment - the scheme of the Act indicates that the assessment is one, though comprises of several years, and the income is also one which is the aggregate of the total income of all the assessment years included in the block period which is independent of the regular assessment for the respective previous years included in the block period. Thus, it forms only one cause of action for the assessee - The several years are, by fiction, treated as one block. The legal fiction so created is recognised as such under the provisions of the 1961 Act as is apparent from sections 158B to 158BB - If it comprises separate and independent distinct causes of action, then court fee is payable separately on each assessment; but when the cause of action is one, then one court fee is payable. - we are inclined to adjourn the question formulated

Issues involved:
Block assessment under Income-tax Act, 1961; Deficiency in payment of court fees; Interpretation of sections 158B, 158BA, and 158BB of the Income-tax Act, 1961; Payment of court fees on appeals in block assessments.

Block Assessment under Income-tax Act, 1961:
The appeal in question pertains to a block assessment covering ten previous years. The advocate for the appellant argues that a block assessment is distinct from a regular assessment as per sections 158BA and 158BB of the Income-tax Act, 1961. It is explained that the block period comprises previous years preceding the year of search and is treated as one single block of assessment, separate from regular assessments. The total income for the block period is the aggregate of the income for all years within the block, as per provisions of the Act.

Deficiency in Payment of Court Fees:
The issue of deficiency in payment of court fees arises in the context of the block assessment. The court considers the case law precedent where it was established that if the cause of action is one, then only one court fee is payable. In this case, since the assessment is treated as one block giving rise to a single cause of action for the assessee, only one court fee is deemed payable. Therefore, there is no question of any deficiency in the court fees paid.

Interpretation of Sections 158B, 158BA, and 158BB:
The court delves into the interpretation of sections 158B, 158BA, and 158BB of the Income-tax Act, 1961. It is clarified that the block assessment, though covering multiple years, is treated as one single block for assessment purposes. The income assessed in the block period is independent of regular assessments for individual years within the block. The legal fiction created under these sections treats the assessment as a single entity, distinct from separate proceedings for each year.

Payment of Court Fees on Appeals in Block Assessments:
The judgment also touches upon the payment of court fees on appeals in block assessments. Referring to a previous decision, it is emphasized that even though multiple assessments are consolidated and governed by a single judgment, if the cause of action is one, only one court fee is payable. In the present case, where the block assessment is considered a single cause of action, only one court fee is deemed payable. The court directs that a copy of the order be placed before the stamp reporter for necessary action.

Conclusion:
The court, after hearing the submissions, decides that only one court fee is payable in the case of a block assessment covering multiple years. The matter is adjourned for further proceedings, and all parties are instructed to act as per the court's order. The judgment is agreed upon by both judges present, and the case is scheduled for the next hearing date for admission and disposal.

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