Law:

Section:

Section 158BC, read with section 158BB, of the Income-tax Act, 1961 - Block assessment in search cases - Procedure for - Block period 1-4-1989 to 7-2-2000 - Examination of assessee's books of account during search revealed that full particulars of turnover of assessee's business had not been reflected in books of account - Managing partner of assessee-firm admitted that entries in books of account reflected only about 75 per cent of actual sales - Based on such admission, assessee's undisclosed income was computed for block period - Assessee assailed block assessment on two grounds, viz., (1) assessment of undisclosed income for broken period relevant to assessment year 2000-01 was not justified as assessee had time to file return for that period; and (ii) by assessing undisclosed income for period relevant for assessment year 2000-01, Assessing Officer had virtually subjected income attributable to that period to tax twice, once in assessment for block period and again in regular assessment - Whether since subject-matter of block assessment period was not disclosed income or that can be disclosed, but only undisclosed income even as indicated in section 158BC, fact that assessee was disclosing income in its regular return to be filed in normal course would not in any way affect computation of undisclosed income for block period - Held, yes - Whether undisclosed income being taken at 25 per cent over and above disclosed turnover, it could be said that same income had been subjected to tax twice, i.e., once during regular assessment and again in block period - Held, no [In favour of revenue] FACTS The assessee-firm was engaged in business of providing catering services in Indian Railways. A search was conducted at the business premises of the assessee on 7-2-2000. The books of account which were examined by the searching officer at the premises of the assessee during the search, revealed that full particulars of turnover of the assessee in the catering business had not been reflected in the books of account. The managing partner of the assessee-firm accepted before the searching officer that the firm was not in the practice of entering its entire sale…

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