TaxTMI 
TaxTMI 
2008 (11) TMI 70
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....section 158BC could not be made unless the assessment is based only on materials, valuables, etc., found during the course of such search? 2. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the issues considered in the block assessment should have been considered in a reassessment procedure and not in a block assessment ? 3. Whether, in the facts and circumstances of the case, the Tribunal was right in holding that the information not found during the course of search cannot be used to arrive at an undisclosed income under the block assessment as per section 158BB amended with retrospective effect from July 1,1995 ? 4. Whether, in the facts and circumstances of the....
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....ard to the sustainability of the addition of the undisclosed income, the Tribunal held that the existence of the fixed deposits was not detected as a result of the search but by investigation which followed the search and in view of Chapter XIV-B of the Act which is a special procedure for assessment of "undisclosed income found as a result of the search only" held that the sum of Rs. 2.56 crores cannot be included in the undisclosed income of the block period. Against this the Department preferred this appeal. 4. Heard the counsel Mr. T. Ravikumar for the Revenue and Mr. T. N. Seetharaman for the assessee. 5. The facts are not in dispute. This question has been considered in the following cases: CIT v. G. K. Senniappan [2006] 284 ....
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....he special auditors, assessment was made. It was contended by the assessee that the income was determined not on the basis of any materials unearthed during search, but on the basis of the report of the special auditors. The court held (page 145) : "The special procedure of Chapter XIV-B is intended to provide a mode of assessment of undisclosed income, which has been detected as a result of search. As the statutory provisions go to show, it is not intended to be a substitute for regular assessment. Its scope and ambit is limited in that sense to materials unearthed during search. It is in addition to the regular assessment already done or to be done. The assessment for the block period can only be done on the basis of evidence found as ....
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....sessing Officer to reconsider the claim for deduction, the Tribunal ought not to have observed that the claim for deduction was only a legal contention and the claim could not be recorded as false claim. The view expressed by the Appellate Tribunal that the claim for deduction was not a false claim was not approved by the court. 10. The learned counsel for the assessee also submitted that after having held that the additional evidence shall not be taken into account, it was not open to the Tribunal to go into the merits of the additional evidence in the assessee's challenge to the inclusion of any undisclosed income, the observations made by the Tribunal will prejudice the assessee. 11. Here, the grievance of the assessee is with rega....