The Commissioner Of Income Tax,Central - I, Mumbai v. M/S. Bombay Trading & Marketing Co

IN THE HIGH COURT OF JUDICATURE AT BOMBAYO. O. C. J.INCOME TAX APPEAL NO.2234 OF 2009 The Commissioner of Income Tax,Central - I, Mumbai Vs. M/s. Bombay Trading & Marketing Co. ..... Mr. Suresh Kumar for the Appellant.Mr. Prashant P. Prabhu for the Respondent. .... ..Appellant. ..Respondent. P.C.: CORAM:DR. D.Y. CHANDRACHUD, & J.P.DEVADHAR, JJ. 4th January, 2010. 1.In the appeal filed by the Revenue the following question of law has been framed : "Whether on the facts and circumstances of the case, the Hon'ble Tribunal was correct in law in directing the Assessing Officer to delete the addition of Rs.57,53,250/- (actual addition in AO is Rs.53,57,796/-) on the grounds that the said addition falls outside the scope of Section 158BC of the Income Tax Act, 1961?" 2.Briefly stated, block assessment proceedings were instituted pursuant to a search that was carried out on 24th September, 2002. In the regular return filed by the assessee for Assessment Year 2002-03 certain credit balances on account of sundry creditors were reflected in the balance sheet of the assessee as on 31st March, 2002. The Tribunal has in these circumstances noted that the aforesaid credit balances formed a part of the regular return filed by the assessee. It appears that in the search which was conducted between 24th September, 2002 and which was concluded on 5th October, 2002, certain loose papers were seized, which included a paper which gave certain details of the balance sheet of the assessee as on 31st March, 2001. According to the assessing officer, on a verification of the balance sheets of the assessee which were filed together with the returns of the income for various years, certain sundry creditors were being carried forward for a number of years. Since the assessee had filed confirmatory letters only for a few cases, the assessing officer recorded that there were bogus sundry creditors in the list. This came to be deleted by the CIT (Appeals) who accepted the contention of the assessee that the amounts could not form part of the block assessment since the details of the sundry creditors were already available with the department as part of the regular return. The CIT (Appeals) held that it was a settled proposition of law that the subject matter of an assessment under Section 158 BC was undisclosed income found as a result of a search or as a result of a related investigation. The deletion has been confirmed in appeal by the Tribunal. 3.The view which has been taken by the Tribunal does not warrant any interference having regard to the position that the credit balances on account of sundry creditors admittedly appear in the balance sheet of the assessee as on 31st March, 2002 which was filed together with the return for Assessment Year 2002-03. Hence, these form a part of the regular return filed by the assessee and could not be made the subject matter of the block assessment. 4.The Appeal therefore does not raise any substantial question of law and is accordingly dismissed. (DR.D.Y.CHANDRACHUD, J.) (J.P.DEVADHAR, J.)