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TMI Blog2013 (6) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... Bench of this Hon'ble Court has admitted the instant appeal on the following substantial question of law: "Whether the view of the Tribunal deleting the two additions of Rs.40,58,000/- and Rs.20,38,274/- aggregating to Rs.60,96,274/- is legally justified and is in accordance to the law." 3. The brief facts of the case are that the assessee is a practicing medical doctor having different sources of income such as income from agricultural activities, medical profession and pathology etc. On 25.09.1996, a search at the residential premises of the assessee as well as a survey under section 133-A of the Act simultaneously was conducted at the business premises situated at Tulsidas Marg, Lucknow, where Charak X-Ray Clinic and Blood Bank are lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Charak X-Ray, he submits that the details of the business activity and agreement were not known. The profit rate of 45% was rightly estimated by the A.O. 6. Learned counsel further submits that the Tribunal has failed to take into consideration the amendment incorporated by the Finance Act, 2002, in the definition of "Undisclosed Income" under section 158 BC of the Act, which has enlarged the meaning of undisclosed income and, as such, now the block assessment of undisclosed income is to be based on the evidence found in search and the material or information gathered in post - search inquiries made on the basis of evidence found in search. He has drawn attention to circular no.8 of 2002 dated 27.08.2002 pertaining to the undisclosed incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eclared by the assessee as his own income. However, by means of the lease agreement dated 16.04.1993, the said X-ray unit was given by the assessee on lease. The assessee thereafter, declared the lease income in his return, which was accepted by the Department. He also submits that the additions were made on estimate basis, which is a question of fact and the same cannot be challenged before the Hon'ble High Court under Section 260-A of the Income Tax Act. For this purpose, he has relied on the ratio laid down in the following cases:- 1. CIT vs. Khushlal Chand Nirmal Kumar; (2003) 183 CTR (MP) 503; 2. CIT vs. S. Ajeet Kumar; (2008) 300 ITR 152 Madras; 3. CIT vs. V. B. Aggarwal; (2006) 206 CTR (Delhi) 87; 4. CIT vs. R. M. L. Mehrotra; (2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y sustained. 12. Needless to mention that in the case of Commissioner of Income Tax vs. S. Ajit Kumar; (2008) 300 ITR 152 (Mad), it was observed that:- "in the course of survey operation, the Revenue found that the assessee had paid cash over and above the amount paid by cheque. It is an indisputable fact that the cost of construction and interior decoration through M/s. Elegant Constructions, was known to the Department even before the date of search. Admittedly, no material was found during the course of search operation in respect of amount said to be paid in cash over and above the cheque payment. Hence, the Tribunal correctly come to the conclusion that the information or material found during the course of survey operation at the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be, as increased by the aggregate of the losses of such previous years.' A mere reading of the above provision clearly indicates that the sentence "such other materials or information as are available with the Assessing Officer & quot; cannot be bisected or taken in isolation for the purpose of computation. Such other materials or information as are available with the Assessing Officer, should as per the section relatable to such evidence. The word "such" used as a prefix to the word "evidence" assumes much significance, in this provision, as it indicates only the evidence found, as a result of search or requisition of books of account or other documents, at the time of search. Any other material cannot form basis for computation of undisc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, and by considering the totality of the facts and circumstances of the case, it appears that "undisclosed income" of the block period has to be determined on the basis of evidence found as the result of search or requisition of books of accounts or other documents and such other materials or information as are available with the A.O. and relatable to such evidence with certain other conditions. It is not open for the A.O. to compute the income on the basis of best judgment. 14. In view of above, no substantial question of law is emerging from the impugned order passed by the Tribunal. Thus, the appeal filed by the department has no merit and the same is liable to be dismissed. The answer to the substantial question of law is in affirma ..... X X X X Extracts X X X X X X X X Extracts X X X X
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