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TMI Blog1998 (7) TMI 132X X X X Extracts X X X X X X X X Extracts X X X X ..... ment years 1988-89, 1989-90, 1990-91, 1992-93 and 1993-94 as envisaged under section 139. Hence the total income for the five years aggregating to Rs. 2,62,338 is treated as the undisclosed income of the block period under section 158BB(1)(c). The total undisclosed income of the block period was mentioned in the assessment order as under: Previous year Amount 1987-88 Rs. 75,080 1988-89 Rs. 54,745 1989-90 Rs. 55,053 1991-92 Rs. 37,375 1992-93 Rs. 40,085 -------------- Total Rs. 2,62,338 -------------- Aggrieved by the same, the assessee preferred this appeal before the Tribunal. 3. The assessee's counsel filed a paper-book of five pages, containing the acknowledgements for having filed the returns for the assessment years 1988-89, 1989-90, 1990-91, 1992-93 and 1993-94. He urged that the returns for the assessment years 1988-89, 1989-90 and 1990-91 were filed on 29-1-1993 and the returns for the assessment years 1992-93 and 1993-94 were filed on 19-5-1995. Accordingly, he urged that the Assistant Commissioner erred in taking the income of Rs. 2,62,338 as the undisclosed income for the block period 1-4-1995 to 6-2-1996 as mentioned in the impugned assessment order. He al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 158BH, which reads as under:- "158BH. Save as otherwise provided in this Chapter, all other provisions of this Act shall apply to assessment made under this Chapter." The impugned assessment order is not a speaking order passed after the application of mind by the Assessing Officer to the relevant provisions of law. In these facts and circumstances of the case we set aside the impugned assessment order. 6. In the result the appeal is allowed. Per N.D. Raghavan (Judicial Member) - I have carefully gone through the erudite order proposed by my learned brother, but with great respects and inspite of persuading myself to agree with it even after discussions with him over it, I am unable to concur' with him after, however, giving considerable thought to the contents and conclusions of the order proposed by him, for the reasons following: 2. In the instant case, it is true that the assessment order in its cause title portion against Column No. 6 the block period is stated as 1-4-1995 to 6-2-1996; but this seems to be more and mere a typographical error, for, the assessee himself has mentioned in its memorandum of appeal itself and in other references on record the block period as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ock period of 1-4-1985 to 6-2-1996 without any valid basis since returns were filed, and observing that the impugned assessment order is not a speaking order passed after the application of mind by the Assessing Officer to the relevant provisions of law, resulting thus in annulment of the assessment order for the reasons particularly detailed in para-5 at page-2 of the proposed order of the Vice-President? Or (b) opining that as no valid return was filed by the assessee under section 139 of the Act, the income declared in the belated returns cannot be considered by the Assessing Officer and while so confirming his action on this point, with reference to deductions claimed under section 80CCA for the assessment years 1989-90 and 1990-91 and deduction claimed under section 80G for the assessment year 1990-91- for a decision de novo by the Assessing Officer through a speaking order after giving opportunity of being heard to the assessee, for the reasons particularly detailed in paras 2 and 3 at pages 5 and 6 of the dissenting order of the Judicial Member?" THIRD MEMBER ORDER As a result of difference of opinion between two Members who heard this appeal originally, the following p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me for the assessment years 1988-89, 1989-90, 1990-91, 1992-93 and 1993-94 as envisaged under section 139 of the Act. Therefore the Assessing Officer stated that the total income of the assessee for the five years aggregating to Rs. 2,62,338 was being treated as undisclosed income of the block period under section 158BB(1)(c). The total undisclosed income of the block period was mentioned in the assessment order as under:- Previous year Amount 1987-88 Rs. 75,080 1988-89 Rs. 64,745 1989-90 Rs. 55,053 1991-92 Rs. 37,375 1992-93 Rs. 40,085 ------------- Total Rs. 2,62,338 ------------- Tax on the abovementioned undisclosed income was computed at Rs. 1,57,404 at the rate of 60%. 3. The first appeal against the aforesaid assessment was heard by a Bench of the Tribunal consisting of Hon'ble Vice-President-cum-Accountant Member and also the Judicial Member. After stating the facts of the case, the Hon'ble Vice-President stated that for the assessment year, the block period was shown to be comprising the period from 1-4-1995 to 5-2-1996. He stated that however the Assessing Officer had included certain amounts as mentioned in the assessment order as the alleged undisclosed inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aside the impugned assessment order, without clearly specifying the purpose of his order in that regard. In Income-tax parlance, the word "Setting aside" means cancelling the order and allowing the Assessing Officer to pass a fresh order in its place. In such a case, the Appellate/revisionary authorities generally add an extra sentence directing the Assessing Officer to redo it afresh in accordance with the law. In this case, the Hon'ble Vice-President, however did not give any specific direction to the Assessing Officer to redo the assessment once more. Again, in the concluding paragraph of his order, he allowed the appeal. Generally, in the case of setting aside by the appellate authority for the purpose of allowing it to be redone, the appeal is considered to be partially allowed or allowed for statistical purposes, lastly, again, from the point of reference made to me, to which both the deciding members are parties, it is quite evident that the order of the learned Vice-President tended to result in annulment of the assessment order. Hence, 1 am taking as if the Hon'ble Vice-President used the expression "set aside" in his order in the sense of "annulment" of the impunged asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re such money, bullion, jewellery, valuable article, thing, entry in the books of account or other documents or transactions represents wholly or partly income or property which has not been or would not have been disclosed for the purposes of this Act. In the present case, the impugned assessment order clearly states that all the investments have been considered in the hands of the assessee in his individual status and hence such investments even if they be undisclosed in nature cannot be considered in the impugned assessment in the case of the HUF. The income returned by the assessee in the belated and invalid returns filed by it is merely of the nature of rent and interest earned. Such income does not extractly fit in with the definition of various items of income as mentioned in section 158B(b). It has been held by the ITAT., Bombay Bench in the case of Sunder Agencies v. Dy. CIT[1997] 63 ITD 245 that although the definition of "Undisclosed income" is stated in section 158B(b) to be merely inclusive, the said definition has however got to be considered as exhaustive definition of the expression, "undisclosed income". 10. There cannot be any doubt about the fact that the impugn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required to be shown. In the instant case, there is not existence of undisclosed income at all. Hence, the question of application of difference clauses of sub-section (1) of section 158BB for the purpose of computing undisclosed income for the block period cannot arise. Finally, therefore, I hold that on account of non-existence of any undisclosed income the impunged assessment under Chapter XIV-B for the block period is liable to be annulled. I therefore agree with the setting aside of the assessment tantamounting to annulment of the same. In view of the annulment of the impugned assessment, the question of allowing of the claims of the assessee under Chapter VI-A does not arise and the second issue as referred to in the point of difference, therefore, becomes infructuous. 12. In the result, the appeal filed by the assessee is required to be allowed. Per N.D. Raghavan (Judicial Member) - In conformity with the answer to the points of difference given by the third Member in his order dated 23.4.1998 agreeing with the setting aside of the assessment tantamounting to its annulment thus resulting in the question of allowing the assessee's claim under Chapter VIA not arising and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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