1999 (4) TMI 115

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....n response to a notice issued under s. 158BC, the assessee filed the return of income in Form No. 2B on 17th June, 1997. In the course of the assessment proceedings the AO found that the assessee received Rs. 70,000 on the sale of an immovable property. On the transfer of the property the capital gains assessable in the hands of the assessee was determined at Rs. 21,375. There was also a gross salary of Rs. 34,903 received during the previous year relevant for the asst. yr. 1994-95. After allowing the statutory deductions the net income under the head 'salary' was assessed at Rs. 23,270. The AO thus arrived at the total income for the asst. yr. 1994-95 at Rs. 44,650. As no returns had been filed by the assessee prior to the search, the tota....

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....y on the income above the basic limit included in the gross total income. 5. We do not agree with the learned representative that in computing the undisclosed income of the block period exemption is to be allowed for the basic amount. The basic exemption is available only at the time of levying tax at the rates as provided in the Finance Act for the respective assessment year. In respect of undisclosed income of the block period, tax is levied not in accordance with the Finance Act, but as provided under s. 112 of the IT Act. There is no provision either in Chapter XIV or in s. 112 providing for basic exemption and restricting the levy of tax on the excess amount alone. The contention of the learned counsel to allow basic exemption was thu....