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1 - 10 of 12 (0.22 seconds)Section 158BC in The Income Tax Act, 1961 [Entire Act]
Dy. Cit vs Smt. Geeta Gupta on 30 June, 2003
When the judgments relied upon by the CIT(A) and the judgment of the jurisdictional High Court in the case of CIT v. Smt. Geeta Gupta are to be read in the context in which these have been rendered, we are confident that there is no scope for any ambiguity. The restriction placed by various High Courts and the Tribunal in the above referred decisions is that in the case of a search where no incriminating material is found, the AO cannot investigate the transactions, which are recorded and disclosed in the regular course of assessment. Once incriminating documents are found in the course of search, the proceedings under Section 158BC or Section 158BD would be permissible even if those documents relate to the transactions disclosed in the original return. In this case, the assessee had disclosed the capital gains and the investments in the house property in the regular return of income. However, as a result of search in the case of M/s Classic Global Impex Ltd. the transactions in shares disclosed by the assessee in the return of income have been found to be bogus. It is on the basis of incriminating documents found in the course of search that the transactions disclosed by the assessee are found to be bogus and consequently the investment made in the house property claimed to have been met out of the said capital gains has remained unexplained and accordingly, addition would be justified on account of undisclosed income. As pointed out earlier, the bar under Section 158BC/158BD, in regard to the transactions disclosed in the return/balance sheet or during the assessment proceedings, applies on such transactions in respect of which no incriminating document is found in the course of search. This distinction has been overlooked by the CIT(A). We, therefore, taking the totality of the facts and circumstances of this case into consideration, set aside his order in regard to this issue and hold that the AO would be justified in taking action under Section 158BC/158BD even in respect of transactions disclosed in the return of income if incriminating documents are found as a result of search under Section 132 in the case of assessee or in the case of third party relating to undisclosed income. His order is, therefore, liable to be set aside. The order of the CIT(A) on this issue is accordingly set aside.