9911796707
TMI Blog2014 (9) TMI 690X X X X Extracts X X X X X X X X Extracts X X X X ..... re as under: [2.1] That the assessee is a partner in the firm of M/s. Chandulal Govindlal Choksi, Dabhoi (hereinafter referred to as "firm") of Choksi Group. Such operations were conducted by the income tax authorities under Section 138 of the Income Tax Act, 1961 (hereinafter referred to as "Act") at the residential and business premises of Choksi Group. That the Assessing Officer initiated the proceedings under Section 158BC and in response thereto the assessee submitted the return for the block period from 01.04.1985 till August 1985, on 16.07.1986. That the Assessing Officer made the block assessment, computing the undisclosed income at Rs. 1,16,482/vide order dated 12.08.1996. That the Assessing Officer treated the share income of Rs. 1,16,482/in the firm as undisclosed income for the years for which no returns for income were filed by the assessee. That it was the case on behalf of the assessee that as, since the income was below taxable income, the assessee did not file the return. It was also the case on behalf of the assessee that since the firm has been filing its return of income, the share income of the assessee from the said firm cannot be treated as undisclosed incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure question of law, the following substantial question of law is formulated/raised as an additional question. "Whether in the facts and circumstances of the case, the share income derived by the assessee from the firm which is exempted as per Section 10 of the Act and which would not be forming part of "total income", the nondisclosure of the same can be treated as undisclosed income within the meaning thereof in section 158B(b) of the Income Tax Act, 1961 under Chapter XIVB?" [3.1] Shri Manish Shah, learned advocate appearing on behalf of the assessee has vehemently submitted that the learned Tribunal has materially erred in holding that share income of the appellant from the firm which was not disclosed and for which the return was not filed as "undisclosed income" within the meaning thereof in section 158B(b) of the Act under Chapter XIVB. [3.2] It is submitted that as such the firm had filed its return of income disclosing the share income of the appellant from the firm and therefore, as such it cannot be said that the share income was "undisclosed income". In support of his above submissions, he has relied upon the decision of the Karnataka High Court in the case of Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee and against the revenue and consequently to hold that nonfiling of the return and consequently nondisclosing the share income received/derived by the assessee from the firm, which had already filed its return disclosing the share income of the appellant cannot be treated as "undisclosed income" within the definition of "undisclosed income" as contained in clause (b) of section 158B of the Act and consequently to quash and set aside the block assessment order passed by the Assessing Officer confirmed by the learned Tribunal. [4.0] Present tax appeal is opposed by Shri K.M. Parikh, learned advocate appearing on behalf of the Revenue. It is submitted by Shri Parikh, learned advocate appearing on behalf of the Revenue that in the facts and circumstances of the case, when the assessee did not file the return disclosing the share income received by him from the firm despite even after search and seizure and the block assessment proceedings were initiated, the learned Tribunal has not committed any error in holding that the share income of the assessee from the firm was undisclosed income within the meaning of "undisclosed income" as contained in clause (b) of section 158B of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r nonfiling of the return by the assessee and not disclosing the share income derived / received by the assessee from the partnership M/s. Chandulal Govindlal Choksi can be said to be "undisclosed income" within the meaning thereof in Section 158B(b) under Chapter XIVB of the Act? [5.1] It is the case on behalf of the assessee that as such the firm itself filed the return of income disclosing the share income paid to the appellant and therefore, it cannot be said there was a nondisclosure of the said income and therefore, the same cannot be treated as "undisclosed income" within the meaning of Section 158B(b) under Chapter XIVB of the Act. It is also the case on behalf of the assessee that in any case as the share income received by the assessee from the partnership firm was as such exempted under Section 10(2a) of the Act i.e. the said income was not required to be included in the "total income" and therefore, nonfiling of the return disclosing the assessee income received from the firm cannot be treated as undisclosed income within the definition of "undisclosed income" as contained in clause (b) of section 158B of the Act, as same is not required to be included in the "total in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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