AI Drafter 
TaxTMI 
TaxTMI 
2004 (2) TMI 52
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....me-tax Act, 1961 ("the Act" for short), in pursuance of a search conducted under section 132 of the Act on July 13, 1999. The said assessment order was passed after obtaining the previous approval from the Joint Commissioner of Income-tax (Range 4), Bangalore, as required under section 158BG of the Act. The assessee challenged the assessment order before the Commissioner of Income-tax (Appeals)-II, Bangalore, in I.T.A. No. 436/CIT(A)-II/2001-02. The appeal was allowed in part by an order dated February 7, 2002, granting certain reliefs. The assessee filed a further appeal before the Tribunal and the Tribunal by an order dated September 29, 2003, allowed the said appeal in part granting some more reliefs. The appellant is aggrieved by ....
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....r should have given a hearing to the assessee. It is submitted that the power to grant previous approval under section 158BG is an amalgam of appellate and revisional power and, therefore, the right to a hearing should be read into section 158BG. It is also contended that the Tribunal failed to consider this ground though specifically urged before it. Chapter XIV-B contains a special procedure for assessment of search cases. Section 158BC prescribes the procedure for block assessment. Clause (c) of section 158BC enables the Assessing Officer, on determination of the undisclosed income of the block period, to pass an order of assessment and determine the tax payable by him on the basis of such assessment. Clause (b) requires the Assessing....
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....been made in accordance with the provisions of Chapter XIV-B. The previous approval is purely an internal matter and it does not decide upon any rights of the assessee. The joint Commissioner, while examining the matter under the proviso to section 158BG does not examine or adjudicate upon the rights or obligations of the assessee, but only considers whether the Assessing Officer has fulfilled the requirements of Chapter XIV-B. In V.C. Shukla v. State (Delhi Administration), AIR 1980 SC 1382, the Supreme Court gave the following example: "In cases where law requires sanction to be given by the appointing authority before a prosecution can be launched against a Government servant, it has never been suggested that the accused must be he....
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....ng: Rs. 2S lakhs advanced by cheque by M/s. Praveen Textiles (of which the assessee's daughter-in-law was the proprietrix), Rs. 15 lakhs advanced by cheque by the assessee's proprietary concern (H. Ashok Kumar and Co.) and Rs. 73,00,000 advanced in cash. The Tribunal observed: "3.2 While examining the issue of advances to Balakrishna group it has been found and held that the amount was advanced to Balakrishna group out of the funds belonging to the assessee, the Hindu undivided family of the assessee amounting to Rs. 73 lakhs and also by the daughter-in-law of the assessee. The interest pertains to the entire advances and it cannot be said that the entire interest received is out of the advance given by the assessee alone. In the circums....
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....s. The Tribunal has now restricted the liability of the assessee to his portion of the interest income of Rs. 22 lakhs. Any attempt by the assessee to disturb that finding would result in the entire Rs. 22 lakhs being treated as undisclosed income of the assessee. It is next contended that the finding of the Tribunal that the portions of the interest income of the assessee's Hindu undivided family and daughter-in-law, out of Rs. 22 lakhs, will have to be taxed in the respective cases, is opposed to the principles of natural justice, as neither the assessee's Hindu undivided family, nor the assessee's daughter-in-law have been heard in the matter. According to the appellant, the Tribunal ought to have restricted its direction that the und....