TaxTMI 
TaxTMI 
2014 (2) TMI 801
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....ash and FDRs were recovered and seized. A notice under Section 158BC of the Act was issued by the Assessing Officer on 20.11.1998 requiring the assessee to file the return for the block period 01.04.1989 to 29.10.1998 within a period of 16 days. The assessee filed the return on 01.03.1999 disclosing undisclosed income of Rs. 1,17,00,000/only. Subsequently, the assessee filed a notarised affidavit on 16.08.1999 disclosing additional undisclosed income of Rs. 58,20,815/. A notice under Section 143(b) of the Act was issued on 24.08.1999 and the proceeding was conducted on different dates before the Assessing Officer. 3. Before the Assessing Officer, the assessee contended that the delay in filing the return under Section 158BC was attributable to the Department as the assessee was not provided with extract of the seized documents for which it was entitled under Section 132 (9) of the Act. It was contended that the return was filed in a haste with a view to avoid penal interest and therefore, in the absence of relevant documents the total concealment could not be disclosed by the assessee. It was further contended that since the assessee itself disclosed an additional concealed inco....
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....g under Section 158BC of the Act is initiated, it is not open to the assessee to take a stand that the disclosure was made prior to detection by the Department. Referring to the facts of the case, it was contended on behalf of the Revenue that the amount of concealment disclosed by way of affidavit dated 16.08.1999 contained only the deposits made in two bank accounts and those transactions were made by the assessee itself and therefore, the assessee was in the knowledge of those transactions and thus, it cannot be contended by the assessee that in the absence of the alleged nonsupply of documents, the assessee could not make the correct disclosure. Relying on second proviso to Section 158BC of the Act, it was contended on behalf of the Revenue that, since the assessee had already furnished return under Section 158BC of the Act, it was not entitled to file a revised return and therefore, the income disclosed by the assessee was treated as concealed income in terms of Section 158BFA of the Act. 6. On behalf of assessee, it was submitted that inspite of repeated requests made by the assessee for supply of documents and release of Computer Hard Disc on 05.11.1998, 09.11.1998, 16.11....
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....ground, it is contended on behalf of the Revenue that, in view of second proviso to Section 158BC of the Act since the assessee is not entitled to file a revised return, the undisclosed income detected after, filing of return for block assessment whether detected by the Department on its own or pursuant to the subsequent disclosure made by the assessee in the garb of the revised return, would be treated as a concealed income on which penalty would be imposed and since this aspect of the matter has not been considered by the CIT (Appeals) or by the learned Tribunal, the appeal preferred by the Revenue deserves to be allowed. Mr. Deepak Roshan, the learned counsel appearing for the Revenue has contended that though the Assessing Officer has rightly considered this aspect of the matter, the learned Tribunal has erroneously ignored the effect of second proviso to Section 158BC of the Act on the ground that since the additional undisclosed income of Rs.58,20,815/was disclosed by the assessee on 16.08.1999 that is, prior to notice under Section 143(2) or any other notice issued by the Assessing Officer therefore, the said income was not liable to penalty. The learned counsel for the appe....
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....BC(c) of the Act provides determination of the tax payable after determination of the undisclosed income for the block period. It further provides that the order of assessment so passed by the Assessment Officer should specify the manner in which the undisclosed income for the block period has been computed by him. Section 158BC further provides that the income of the block period would be determined in the manner laid down under Section 158BB and the provisions of Section 142, Section 143(2), Section 143(3), Section 144 and Section 145 of the Act. Section 158BE prescribes the time limit for completion of block assessment and, Section 158BF and Section 158BFA relate to levy of interest and penalty. Thus, it is clear that Chapter XIVB is a selfcontained code which provides for special procedures which has to be adopted for assessment in search cases. 11. The relevant extract of Explanation to Section 158BA, second proviso to Section 158BC, Section 158BF & First proviso to Section 158BFA(2) of the Income Tax Act,1961 are extracted below: Explanation to Section 158BA For the removal of doubts, it is hereby declared that ( a) the assessment made under this Chapter shall be ....
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....rs that the very purpose of inserting the second proviso to Section 158BC prohibiting the assessee from filing the revised return is to prevent the assessee from filing a revised return, from time to time, depending on the development that takes place during the course of assessment proceeding. The intention appears to be preventing the assessee from getting away with the penalty imposable under Section 158BFA. The second proviso to Section 158BC uses the expression "shall not be entitled to" which further reflects the legislative intention that it is mandatory in nature and it admits no exception. 13. The legal position thus appears to be that, the assessee cannot file even a revised lower return on account of some mistake committed by him and thus, the second proviso to Section 158BC is intended at prohibiting the assessee from filing a revised higher return with a view to get away with imposition of penalty on the undisclosed income. The plea taken by the assessee that penalty could not have been imposed on the additional undisclosed income disclosed by the assessee itself, is fallacious. The assessee seems to suggest that had such disclosure not been made by the assessee, th....
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....he assessee on 16.08.1999. 16. We have held that second proviso to Section 158BC is mandatory and the provision under Section 158BFA is also mandatory subject to the conditions mentioned therein, and therefore, the intention of the assessee is immaterial. In "Chairman, SEBI Vs. Shriram Mutual Fund and Anr.", reported in (2006) 5 SCC 361, while holding that Section 15A to Section 15HB of the SEBI Act, 1992 are mandatory provisions which provide imposition of penalty in cases of default, the Hon'ble Supreme Court has held as under: 35. "In our considered opinion, penalty is attracted as soon as the contravention of the statutory obligation as contemplated by the Act and the Regulations is established and hence the intention of the parties committing such violation becomes wholly irrelevant. A breach of civil obligation which attracts penalty in the nature of fine under the provisions of the Act and the Regulations would immediately attract the levy of penalty irrespective of the fact whether contravention must be made by the defaulter with guilty intention or not. We also further held that unless the language of the statute indicates the need to establish the presence of mens r....
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.... return was fixed on 10.12.1998. The assessee was permitted by letter dated 24.12.1998 to take photocopies of the document. A petition was filed by the assessee on 25.01.1999 for release of Computer Hard Disc and by letter dated 02.02.1999 the assessee was permitted to take copies of the Computer Hard Disc. The block return showing undisclosed income of Rs.117.00 lacs was filed on 01.03.1999. Thereafter, the assessee made a petition on 30.07.1999 for taking xerox copies of seized material. The Assessing Officer has found that the additional disclosure made by the assessee on 16.08.1999 was with regard to deposits made in two bank accounts, the transactions in which were made by the assessee itself and no direction was issued to the bank authorities by the Department with respect to the said two bank accounts. This aspect of the matter has not been properly dealt with both by the CIT (Appeals) and the learned Tribunal. There is no explanation by the assessee for moving an application for furnishing documents, 5 months after filing return on 01.03.1999. It appears that the application was moved as an excuse for avoiding penalty u/s 158BFA. We further find that the legal effect of the....