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TMI Blog2013 (8) TMI 289X X X X Extracts X X X X X X X X Extracts X X X X ..... act, in the assessment order, the Department has passed a protective assessment order including the said income - Tribunal was justified in granting relief to the assessee - Decided against Revenue. Income u/s 158BA - Block assessment - Deduction u/s 80L - Held that:- interest accrued on the said FDs cannot be held to be undisclosed income. If the principal amount is not considered as undisclosed income, the interest accrued thereon cannot be construed as undisclosed income and in the returns filed by the assessee, that income is also shown and tax is paid - benefit given to the assessee under section 80L of the Act was not challenged by the revenue before the Tribunal - Decided against Revenue. In the absence of any evidence to show ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment under section 158 BC, the Assessing Officer added a sum of Rs.91,62,048/- apart from the undisclosed income declared by the assessee for a sum of Rs. 1,66,66,490/-. Therefore, the total undisclosed income came to Rs.2,58,28,540/-. A demand was raised for a sum of Rs. 1,54,97,124/- and interest under section 158 BFA(1) of Rs.3,09,942/- was also added. Aggrieved by the said order, the assessee filed an appeal to the Commissioner of Income Tax (Appeals) Mangalore. The Appellate Authority granted reliefs under 5 headings and declined the relief on other grounds. Therefore, both the revenue as well as the assessee preferred appeals against the order of the Appellate Authority to the Tribunal. The Tribunal after hearing both the appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said returns and also paid tax. In this context, the Tribunal held that the aforesaid amount cannot be treated as undisclosed income for the reasons that such investments are out of professional receipts recorded in diaries maintained by the assessee which were found during the survey. Such disclosure in the regular returns based on the diaries satisfies the requirement of section 158 BB(1)(C). The assessee had filed returns disclosing the said income along with the audit report. The Assessing Authority had passed the assessment order under section 143(3) of the Act for the assessment year 1999-2000 and in the said order he has not pointed them as receipts. Therefore, the last date for filing returns was not yet over. As he had an opportuni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income is concerned, the material on record clearly discloses that the assessee owned 10 acres 30 guntas of land along with his brother. The brother was looking after the agricultural operations. Rs. 36,53,333/- is the agricultural income which is converted into FDs in the name of the assessee. In fact, the Assessing Authority before passing the order appointed an Inspector and he was asked to go to the spot and verify the existence of the land and crops which are grown and then submit a report. The said report clearly discloses that the assessee owned the land along with his brother; they were cultivating; the said lands and there exists agricultural income. The pahanies did disclose the name of the assessee and his brother. After being s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in the hospital, in the absence of documentary evidence. Countering the said argument, the assessee has pointed out the in the accounts prior to 1998, there was huge opening balance from which all these acquisitions were made. In that context, the Tribunal was of the view that merely because the documentary evidence is not produced and those items, such as Car, Education expenses and stock of medicines could have been acquired out of the surplus amount and it cannot be construed as having been acquired out of the undisclosed income and the Assessing Authority was in error in adding the same to the declared undisclosed income. Therefore, he has granted the relief to the assessee. In fact, stock of medicines was not challenged by the revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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