Block assessment excludes income below the taxable limit under the amended section 158BB(1)(c)(B).

The retrospective amendment to section 158BB(1)(c)(B) excluded income of any previous year in the block period where that income did not exceed the maximum amount not chargeable to tax. Because the search was conducted after the amendment took effect from 1 July 1995, the amended provision applied to the block assessment under section 158BC. Income below the taxable limit for a previous year within the block period was therefore not includible as undisclosed income for block assessment purposes, and the issue was answered in favour of the assessee.

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Issues: Whether income of a previous year falling below the taxable limit is includible as undisclosed income in the block period under section 158BC of the Income-tax Act, 1961, in view of the amended section 158BB(1)(c)(B).

Analysis: The question was governed by the retrospective amendment to section 158BB(1)(c)(B), which excludes income of any previous year in the block period where such income does not exceed the maximum amount not chargeable to tax. Since the search had been conducted after the amendment took effect from 1 July 1995, the amended provision applied to the block assessment.

Conclusion: Income below the taxable limit for any previous year in the block period was not includible as undisclosed income for block assessment purposes. The answer was therefore in favour of the assessee and against the Revenue.

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