Regular return disclosure cannot be treated as undisclosed income for block assessment when filed within time.

Income disclosed in a regular return filed within the permissible time could not be treated as undisclosed income for the block period under Chapter XIV-B of the Income-tax Act, 1961. The material on record showed that the assessee had filed the return within time and had disclosed the relevant income, and the appellate authority and Tribunal found that the income was within the taxable limit for that year. On those facts, the additions made by the Assessing Authority could not be brought to tax as undisclosed income, and the issue was answered in favour of the assessee.

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Issues: Whether income disclosed in a regular return filed within time could be treated as undisclosed income for the block period and brought to tax under Chapter XIV-B of the Income-tax Act, 1961.

Analysis: The assessee had filed the return for the relevant assessment year disclosing the income in question, and the material on record showed that the income did not remain undisclosed so as to attract block assessment. The factual findings of the appellate authority and the Tribunal were that the return was filed within the permissible time and that the income for the relevant year was within the taxable limit. On those facts, the additions made by the Assessing Authority could not be characterised as undisclosed income for the block period.

Conclusion: The issue was answered in favour of the assessee and against the Revenue.

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