2002 (5) TMI 818 - AT - Income Tax

Summary

Issues:
Block period assessment under section 158BC for years 1986-87 to 1996-97 and 1-4-1995 to 11-10-1995.

Analysis:
The appeal was against the order of the Assessing Officer who computed undisclosed income for the block period at Rs. 2,10,933. The appellant argued that for certain years, the income was below the taxable limit, so no return was filed, and thus, that income should not be treated as undisclosed. The appellant also contended that standard deduction and deductions under Chapter VI-A were not allowed, resulting in an erroneous conclusion of taxable income. The appellant further challenged the denial of rebates and the treatment of salary income from Dollar Services. The appellant provided evidence for deductions claimed under Chapter VI-A and rebate under section 88.

During the hearing, the appellant's counsel emphasized that the Assessing Officer erred in not allowing standard deductions for salaried employees and deductions under Chapter VI-A. The counsel argued that discrepancies in provident fund deductions by Dollar Services do not make the employer bogus. The appellant sought directions to exclude salary income from Dollar Services if necessary. The appellant also highlighted the claim for deductions under Chapter VI-A and rebate under section 88, supported by documentary evidence.

The Tribunal referred to precedents where income below the taxable limit was not considered undisclosed for block assessment. It directed the Assessing Officer to verify and exclude such income for relevant years. The Tribunal upheld the appellant's entitlement to deductions under Chapter VI-A and rebates under sections 80L and 88. The Assessing Officer was instructed to verify supporting documents and allow deductions and rebates accordingly. The Tribunal also ordered the allowance of standard deductions and professional tax deductions related to provident fund deductions by Dollar Services.

In conclusion, the Tribunal restored various reliefs claimed by the appellant to the Assessing Officer for proper adjudication in line with the directions provided and as per the law, ensuring a fair opportunity for the appellant to be heard. The appeal was treated as allowed for statistical purposes.