TaxTMI 
TaxTMI 
2013 (8) TMI 635
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....s follows:- Asst. Year Addition 1998-99 94, 73, 289 59, 45, 386 Undisclosed money on account of undisclosed hire charges 1999-2000 2, 28, 958 17, 35, 561 15, 03, 553 Interest on advance on account of undisclosed hire charges on account of undisclosed hire charges 2000-01 1, 19, 08, 845 58, 95, 208 on account of undisclosed hire chargeson account of undisclosed hire charges. The revenue has preferred the appeal on the following questions of law:- "1. Whether the Hon'ble ITAT was legally correct in holding that all the entires as given in Annexure A-10 could not be regarded as undisclosed income of the assessee in view of the definition of the expression 'undisclosed income' given under Section 158B(b) ignoring the fact that desired books of account were never produced before the AO for the purposes of verification even after directions of Ld. CIT ( A) to that effect. 2. Whether the Hon'ble ITAT was legally correct in holding that all the entires as given in Annexure A-10 could not be regarded as undisclosed income of the assessee in view of the definition of the expression 'undisclosed income' given under Section 158B(b) without ev....
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....t side are generally written with pen which shows the sale proceeds of the potatoes and the payment/ recoveries against these advances. The sales realization by way of Demand Drafts is also in many cases duly reflected in the regular books of account of the assessee for the accounting period 1998-99, however, the advances which are shown in pencil were not shown in the regular books of account. The same aggregate of Rs.94,73,289/- represents the undisclosed income in A.Y. 1998-99. Besides this the assessee was receiving interest on these advances which is not disclosed. The same was calculated Rs.2,28,958/- approximately. The amount of advance at Rs.94,73,289/- was thus added to the income for A.Y. 1998-99 and interest Rs.2,28,958/- added to the income for A.Y. 1999-2000. Shri Shambhu Chopra submits that Annexure-A9 shows that at least 177565 bags were stored in Dass Cold Storage during Feb. March, 1997. The assessee was charging rent of Rs.80/- per quintal which comes to at Rs.65/- per bag. The total rent of 177565 bags comes to Rs.1,15,41,725/- while the assessee has shown receipt as per books of Rs.55,96,339/-. The difference of Rs.59,45,386/- was added to the income of the a....
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....ment year was duly approved by the Board of Directors after it was placed before AGM. The tax auditor has also carried out audit under Section 44AB. The copies of the audited balance sheet and profit and loss account along with auditors' report were filed in the income tax department. The Tribunal's findings in paragraphs 16 and 17 are quoted as follows:- "16. We have carefully considered the rival submissions along with the order of the CIT (A) as well as that of the Assessing Officer. It is undisputed fact that in the case of the assessee, search has taken place on 16.2.2000 and during the course of search a number of incriminating documents were found. The addition of Rs.94,73,289/- was made by the Assessing Officer on the basis of Annexure A-10 seized during the course of search. This addition has been enhanced by the CIT(A) to Rs.1,04,98,275/-. The assessee is a private limited company being governed by the Companies Act, 1956. The assessee is bound to maintain the regular books of accounts and also to get its accounts audited. The accounts are to be approved by the Board of Directors and are to be placed in the Annual General Meeting of the Company every year for the ap....
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....he Assessing Officer as well as before the CIT(A) is that all the entires in the diary seized as Annexure A-10 are duly recorded in the books of accounts maintained by the assessee. These additions were made by Assessing Officer in the block assessment for the Assessment Year 1998-99 and interest thereon was added for the Assessment Year 1999-2000. A-53 is also related to this annexure and entires therein are also in the regular books of account. Before the CIT(A) also the assessee has taken the contention that all the entires in the diary are duly recorded in the regular books of accounts maintained by the assessee on he basis of which the assessee has already filed the return. The CIT(A) has asked for the remand report from the Assessing Officer. The assessing Officer in the remand report under para no. 5.2 even though accepted that the assessee has provided copy of the ledger account of the farmers for the assessment year 1998-99 for verification but took the view that the entires therein are not verifiable from the record. It has also been observed that the assessee did not produce the farmer's ledger account for the assessment year 1999-2000 and also observed that in the block....
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.... on the basis of the evidence found as a result of search or requisition of the books of accounts or other documents and such other material or information as are available with the Assessing Officer and relatable to such evidence. Such evidence here means the evidence found as a result of search. Thus, this section requires the Assessing Officer to compute the total income of each previous year falling within the block period first and then the aggregate to the total income of all previous year falling within the block period first and then the aggregate to the total income of all previous year within the block period will be the undisclosed income of the block period. In our opinion, it is mandatory on the Assessing Officer in view of the special provisions of section 158BB(1) to compute the undisclosed total income of each of the previous year included in the block period. This section also requires that the income has to be computed in accordance with the provisions of Income Tax Act. Section 158BB(2) states that in computing the undisclosed income of the block period, the provisions of Section 68, 69, 69A, 69B & 69C shall, so far as may be, apply and reference to Financial Yea....