Law:

Section:

Section 158B of the Income-tax Act, 1961 - Block assessment in search cases - Undisclosed income - Block period 1987-88 to 1997-98 - Whether those elements of income which already stand disclosed in relevant assessment years falling within block period should be excluded while computing undisclosed income - Held, yes - Pursuant to search conducted at residential and business premises of assessee, notice under section 158BC was issued to assessee - During course of block assessment, Assessing Officer made certain additions representing expenses/income of assessee, as undisclosed income - Whether since there was no evidence found during search by Assessing Officer to make said additions, and relevant expenses/income had been duly reflected and disclosed in course of regular assessment proceedings, same could not be said to be undisclosed income of assessee - Held, yes FACTS The assessee was in the business of dealing in real estate. A search operation under section 132(1) was conducted at the residential and business premises of the assessee. A notice under section 158BC was issued to the assessee. In response to said notice, the assessee filed its return for the block period 1987-88 to 1997-98. The Assessing Officer made additions of Rs. 4 lakhs for the assessment year 1993-94, Rs. 4 lakhs for the assessment year 1994-95 and Rs. 25 lakhs for the assessment year 1997-98. As regards addition of Rs. 4 lakhs in assessment year 1993-94, the Assessing Officer noticed that the assessee had claimed a sum of Rs. 4 lakhs towards project expenses as being the amount paid on 19-4-1992 to one 'K' for vacating a tenanted portion. The assessee's reply to the notice under section 158BC was silent as regards the said payment and the Assessing Officer made addition of said sum. In respect of the addition made as concealed income of Rs. 4 lakhs for the assessment year 1994-95, the Assessing Officer had observed that one 'A' and 'K', the purchasers of the assessee, had agreed to make payment of Rs. 2 lakhs each to a tenant 'B' for vacation of the premises and on enquiry, it was found that the payments were in fact credited to the assessee's account and the said amount of Rs. 4…

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