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TMI Blog2021 (1) TMI 39X X X X Extracts X X X X X X X X Extracts X X X X ..... r disclosure already made by the assessee. It is not necessary to repeat the plethora of case laws which consistently held that what has been already disclosed cannot be a matter of block assessment. The Assessing Officer cannot indulge in roving enquires regarding the issue that has already been disclosed in the books of accounts and placed before the departments. All such enquiries and investigations should be made by the Assessing Officer in a proceeding known to the Income Tax Law other than the block assessment proceedings. Therefore, we are inclined to accept to the substantive ground raised by the assessee on the question of law that whether the loans treated by the Assessing Officer as unexplained could be treated by the Assessing Officer as unexplained could be treated as forming part of the undisclosed income. We hold that the loan amount cannot be made a subject matter of a block assessment on the basis of the review made by the assessing authority. See RAKESH N. DUTT VERSUS ASSISTANT COMMISSIONER OF INCOME-TAX AND OTHERS [ 2007 (10) TMI 285 - BOMBAY HIGH COURT] - Appeal filed by the assessee is allowed. - IT(SS)A No. 68/MUM/1997 - - - Dated:- 20-10-2020 - Shri S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rading Co. ₹ 5,00,000/- during AY 1996-97. The Tribunal held as under : 5. We have duly considered the rival contentions. So far as the credit balance in the name of Bharat Trading Co. is concerned, we see no justification at all for sustaining the addition. Documents placed on record at pages 29 to 34 of Paper book I clearly indicate that in terms of the agreement between the assessee and Bharat Trading Co. the latter was to place a security deposit of ₹ 5.00 lacs with the assessee in consideration of assessee financing the subscription to public issue. The deposit was repaid also within a period of three months. Thus, the addition of ₹ 5.00 lacs cannot be sustained and hence is deleted. 6. As regards the other three credits, no doubt, confirmations with addresses of the parties are on record. Addresses, however, being in different ink and different hand, appear to have been added subsequently. This aspect, of-course, do not automatically establish the loans to be non-genuine. Moreover, the signature of Daoodayal Mundhra on the confirmation materially differs from his signature on the affidavit. We are conscious of the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see one on the ground of facts and the other on the ground of law, (ii) the Tribunal straightaway opted for deciding the alternate ground and directed the AO to add the peak amount of credit, (iii) this approach is not proper in law, as the Tribunal was under an obligation to adjudicate the first two substantive grounds raised by the assessee in respect of the ground relating to unexplained loans. Therefore, the Hon ble High Court felt that the matter should go back to the Tribunal for adjudication of the issue of unexplained loans on substantive grounds as well. Thus the matter has come before us, for the second time. 5. Before us, the Ld. counsel for the assessee explains that there were seven assessees from the same group whose order has been remanded back by the Hon ble High Court to the Tribunal vide order dated 26.02.2002, 05.03.2002 27.08.2005. Referring specifically to the order of the Tribunal dated 26.09.2007 in the case of one of the assessee namely Mr. Vikram Doshi, the Ld. counsel submits that the Tribunal has allowed full relief to the assessee for unproved loans based on the substantive main submission of the assessee that the dispute matter of unproved loan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as income of another year without any limitation applying to issue of notice u/s 148 or to completion of assessment or re-assessment. 6.1 We turn to the assessment order dated 28.02.1997 passed by the AO u/s 158BC(c) of the Act. The introductory paras are as under : 2.1 I had verified the returns of the income filed by the assessee for the period covered by the Block Assessment. A perusal of the relevant balance sheets showed that the following creditors closing balances were reflected as on 31.03.1990. a) Kashiben Dungershi ₹ 1,00,000/- b) Surajben Shah ₹ 1,50,000/- c) Daoodayal Mundhra ₹ 4,50,000/- d) M/s Bharat Trading Co. ₹ 5,00,000/- during AY 1996-97. 2.2 Since the documents seized during the course of the search revealed large scale unaccounted transactions but all these returns had already been accepted u/s 143(1)(a) of the I.T. Act enquiries into the genuineness of these credits became necessary. 6.2 At this moment, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal, which is the final code for finding of fact. Therefore, we have to decide the substantive contention of the assessee, instead of agreeing with the contentions of the Ld. DR that Tribunal may consider directing the AO to initiate the proceedings u/s 148(1) of the Act. The instant case is thus distinguishable from the case-laws relied on by the Ld. DR. 6.5 Similar issue arose before the Tribunal in the case of Shri Vikram Doshi, who happens to be an assessee from the same group. In that order dated 26.09.2007, the ITAT C Bench, Mumbai [IT(SS) A No. 105/Mum/1996] has held that :- 8. The assessee is regularly assessed to income tax. The assessee is also maintaining regular books of accounts. All the loans which have been treated by the assessing authority as unexplained have already been recorded in the books of accounts in the normal course of business as and when the loans were transacted. The balance sheets prepared by the assessee from time to time for different years also reflect the list of loans availed by the assessee from others. The balances sheets have already been filed before the assessing authority along with the returns of income filed by the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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