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TMI Blog2014 (9) TMI 390X X X X Extracts X X X X X X X X Extracts X X X X ..... closed in the books of accounts in the earlier assessment years - there is no duty cast on the assessee to draw specific attention to each and every item of the books of accounts and it is for the ITO to draw conclusions, based on the record and material placed before him and elicit clarifications in the event of doubt - the amounts which were disclosed in the books of accounts for the earlier assessment years cannot be treated as undisclosed income, in the block assessment proceedings – Decided in favour of assessee. Deduction on unaccounted cash payments - Whether an assessee is entitled to claim deductions or allowances in respect of amounts which are found as unaccounted cash payments in the course of search under the resultant block ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I.T. Returns and which are processed in regular assessments could be included as undisclosed income when there was no material found in the course of search in relation to the said items. 2. Whether the assessing officer holds the share holder to be benami of some other share holder, is the value of the shares held by such benami share holder liable to be included as income of the company itself when the real share holder is someone else. 3. Whether in a block assessment, on the basis of the statement recorded from one share holder who is alleged to be a benami shareholder can it be inferred that all the shareholders are benami shareholders without examining each of them. 4. Whether a Tribunal can dismiss the appeal filed by an ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... grieved by the assessment order dated 30.09.1997, the appellant filed Appeal under Section 253(1)(B) of the Act before the Income Tax Appellate Tribunal challenging the various additions made. By an order dated 08.02.2000, the Tribunal deleted some of the additions and while confirming some. Aggrieved by the said order of the Tribunal, the present appeal is filed. 3. However, on perusal of the record and on hearing the learned counsel for both the parties, the following two questions of law would arise for consideration and would address the controversy in issue: a) Whether the amount reflected in Books of Account forming part of returns of a particular assessment year can constitute the subject matter of the proceedings under Chapter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rther submits that the procedure adopted to ascertain the veracity or otherwise of the entries in the books of accounts in the earlier years is contrary to the prescribed procedure for making the assessments for the block period under Chapter-XIVB of the Act. He relied upon the judgments of the High Court of Bombay reported in Commissioner of Income Tax vs. Vinod Danchand Ghodawant 247 ITR 448 and High Court of Andhra Pradesh reported in Commissioner of Income-Tax v. B. Satyanarayana (2013) 356 ITR 323 (A.P). 6) Learned counsel submits that assuming but without conceding, that the appellant was not able to explain the amounts received towards share capital, an assessee, legally not capable of owning its own shares could not be assessed f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of Income-Tax (2 supra). It was held that only such adverse material, as was unearthed during the search, alone can be the basis for the purpose of block assessment, and not the one, that disclosed in the books of accounts in the earlier assessment years. It is settled by catena of judgments that there is no duty cast on the assessee to draw specific attention to each and every item of the books of accounts and it is for the Income Tax Officer to draw conclusions, based on the record and material placed before him and elicit clarifications in the event of doubt. Reference in this context may be made to the Calcutta Discount Company Limited vs. Income Tax Officer, Companies District-I, Calcutta and another 41 ITR 191 (SC) and Parashuram P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n given for the amount of ₹ 3,00,000/- that it was received from the individuals, was not considered, on the ground that there is no material to support such claim. 13. The plea of the appellant about ₹ 65,000/- is that once the Assessing Officer disallowed the expenditure, the same cannot be added for the purpose of assessment. Likewise, regarding the amount of ₹ 1,80,413/- his explanation is that 6%, over and above the interest which has been recorded in the books of account, has been paid in cash, but it is not reflected in the books. His contention is that when an addition is being made treating the said amounts as undisclosed income, the corresponding expenditure must be allowed as expenditure, since the very basis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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