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TMI Blog2005 (12) TMI 61X X X X Extracts X X X X X X X X Extracts X X X X ..... disclosing income from his profession at Rs. 44,800 under section 139(4) of the Act on March 31, 1997. Thereafter, the Assistant Commissioner of Income-tax, Circle 1, Indore, made an assessment of undisclosed income of the appellant for the block period comprising of the assessment years 1988-89 to 1996-97. Aggrieved by the order of assessment dated December 29,1997, the appellant filed appeal before the Income-tax Appellate Tribunal, Indore Bench, Indore, and the Income-tax Appellate Tribunal held that for some of the assessment years, the appellant had no taxable income and for some other assessment years, the tax had been deducted at source. For the assessment year 1996-97, the appellant contended before the Tribunal that since he had ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment of undisclosed income could be applied. In support of his contention, he referred to the definition of "undisclosed income" in section 158B(b) of the Act and submitted that if the income could have been disclosed by the assessee under the Act, such income would not be undisclosed income, to which Chapter XIV-B would be applicable. He submitted that under section 139(4) of the Act, the assessee had a right to file his return of income for any previous year at any time before the expiry of one year from the end of the relevant assessment year or before the completion of the assessment, whichever was earlier, and, therefore, in this case, for the assessment year 1996-97, the appellant had a right to file return under section 139(4) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 139(1) of the Act and if he files such a return after the expiry of the period specified under section 139(1), income has to be regarded as "undisclosed income". He relied on the observations of the learned single judge in the case of B. Noorsingh [2001] 249 ITR 378 (Mad) to the effect that after having suffered a search, the assessee is not to be enabled to escape the consequences of his failure to disclose all his income by filing a return after the search and after the expiry of the time prescribed under section 139(1) and by disclosing therein income which had remained undisclosed up to the date of the search. Mr. Chaphekar, learned senior counsel appearing for the appellant, cited the judgment of the Division Bench of the Madras ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y income based on any entry in the books of account or other documents or transactions, where such money, bullion, jewellery, valuable article, thing, entry in the books of account or other document or transaction represents wholly or partly income or property which has not been or would not have been disclosed for the purposes of this Act, or any expense, deduction or allowance claimed under this Act which is found to be false. Section 158BA. Assessment of undisclosed income as a result of search.-(1) Notwithstanding anything contained in any other provisions of this Act, where after the 30th day of June, 1995, a search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or other documents maintained in the normal course relating to such previous years, the said income shall not be included in the block period." A reading of clause (b) of section 158B of the Act shows that "undisclosed income" includes any money, bullion, jewellery or other valuable article or thing or any income based on any entry in the books of account or other documents or transactions mentioned therein which represents wholly or partly income or property which has not been disclosed or which would not have been disclosed for the purposes of the Act. Thus, a case where the income has not been disclosed for the purpose of the Act will also be a case of undisclosed income. Section 139(1) of the Act requires that a person, if his total i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, if the assessee does not disclose any income in the return filed before the due date of filing such return under section 139(1) of the Act, notwithstanding the fact that his income is reflected in books of account at the time of search, his income is to be assessed as undisclosed income. Mr. Chaphekar, learned senior counsel appearing for the appellant, submitted that there may be cases outside sub-section (3) of section 158BA of the Act where it can be held that the income of the assessee has been disclosed. In fact, he relied on the Division Bench judgment of the Madras High Court in the case of A. R. Enterprises [2005] 274 ITR 110 in support of his submission in which payment of advance tax before the date of search, even in a case w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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