Law:

Section:

Section 158BB, read with section 158B, of the Income-tax Act, 1961 - Block assessment in search cases - Undisclosed income, computation of - Block assessment period 1-4-1989 to 10-2-2000 - During a search conducted at office premises of assessee, a bill in respect of commission paid on sale of flats by 'T' was found - Books of account of assessee indicated payment of that amount towards commission - Assessing Officer added that amount to income of assessee as undisclosed income on ground that bill was bogus and, in fact, no commission was paid to 'T' - Commissioner (Appeals) upheld that order - However, Tribunal deleted addition on ground that amount of commission paid was indicated in books of account maintained by assessee in regular course of its business prior to search - Whether Tribunal had rightly deleted addition - Held, yes FACTS During a search of the office premises of the assessee, a bill for certain amount in respect of commission on sale of flats by 'T' was found. The books of account of the assessee indicated payment of that amount towards commission. The Assessing Officer added that amount to the income of assessee as undisclosed income on the ground that the bill was bogus and, in fact, no commission was paid to 'T'. The Commissioner (Appeals) upheld the order of the Assessing Officer. However, the Tribunal deleted the addition holding that the amount of commission paid by the assessee to 'T' was shown in the books of account maintained by it in the regular course of its business prior to the search; and that there were no adequate reasons for considering the commission paid to be bogus. On revenue's appeal : HELD The amount of commission paid by the assessee to 'T' was shown in the books of account maintained by it in the regular course of its business prior to the search. Said amount had also been shown by the assessee in its regular returns. [Para 5] It was not clear from the record as to what happened in the regular assessment of the assessee, but the fact that the amount was sought to be included in the block assessment suggested that the contention of the assessee was accepted in the regular assessment. [Para 6] On a reading of provisions…

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