bgp bgp bgp IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION INCOME INCOME INCOME TAX APPEAL NO.1238 OF 2008 TAX APPEAL NO.1238 OF 2008 TAX APPEAL NO.1238 OF 2008 The Commissioner of Income Tax, ..Appellant Vs. M/s.Anewera International Marketing ..Respondent Mr.Suresh Kumar for the Appellant. Mr.P.J.Pardiwalla, Senior Advocate with Mr.V.Joshi i/b.S.G.Dalal for the Respondent. CORAM CORAM CORAM :- DR.S.RADHAKRISHNAN & :- DR.S.RADHAKRISHNAN & :- DR.S.RADHAKRISHNAN & V.C.DAGA, V.C.DAGA, V.C.DAGA, JJ. JJ. JJ. DATE DATE DATE : 4TH DECEMBER, 2008 : 4TH DECEMBER, 2008 : 4TH DECEMBER, 2008 P.C. P.C. P.C. 1. Heard the learned Counsel for the parties. By way of present Appeal, the Appellant is seeking to raise the following substantial questions of law: a. Whether on the facts and in the circumstances of the case the Hon’ble Tribunal is justified in law in deleting the addition of Rs.3.07 crores on the ground that this addition could not have been made in Block assessment even though the addition was made as a result of information collected during the course of search in Khandar group of cases and enquiries made thereafter in Khandar group of cases ? b. Whether on the facts and in the circumstances of the case the Hon’ble Tribunal was right in law in deleting the addition of Rs.2.65 lac made by the Assessing Officer on account of interest to be received ? c. Whether on the facts and in the circumstances of the case the Hon’ble Tribunal was right in law deleting the addition of Rs.1.75 lac made by the Assessing Officer on account of interest accrued ? d. Whether on the facts and in the circumstances of the case the Hon’ble Tribunal :2: was right in law deleting the addition of Rs.11.57 lac made by the Assessing Officer on account of trading loss ? 2. We have perused the order dated 26th September, 2007 passed by the Income Tax Appellate Tribunal, especially paragraph Nos.5,7 and 8, which read as under: 5. In the present case, the Assessing Officer asked the assessee to prove the genuineness of the various loans reflected in its books of accounts. It is not that the Assessing Officer is coming to see those loans for the first time, that too as a result of the search conducted on 27th November, 1995. The details of these loans are already with the assessing authority before the date of search. Whether the returns were accepted under Section 143(1) or the assessments were completed under Section 143(3), is not a matter to be decided by the assessee. It is for the assessing authority to decide whether he should accept the return under section 143(1) or he should verify the return and pass an assessment order under Section 143(3). The Asessing Officer may opt for any of the above course of action but such an option exercised by the assessing authority does not dilute the fact that the assessee has disclosed all these particulars to the income-tax department, even before the search. It is not possible to say that such returns filed by the assessees were accepted under section 143(1), there was no true disclosure on the part of the assessee. 7. Therefore, it is to be seen that the factum of availing of loans from various persons has already been disclosed by the assessee to the assessing authority with the details and particulars. It is not permissible in law that the Assessing Officer may undertake further roving enquiries on matters already disclosed by an assessee on the ground that there was a search. The Assessing Officer cannot review his own order, even in a course of block assessment proceedings. Either the search or the enquiries made after the search should bring out specific materials to book the assessee accountable for undisclosed income. In the present case, whether the loans were genuine or not is a matter that could be enquired by :3: the assessing authority in various proceedings available under Income Tax Act, other than the block assessment proceedings. Therefore, we find that there is no basis for making any addition on the ground of unexplained loans and interest. Therefore, the said addition of Rs.3,07,79,627/- is deleted. 3. It is clear that there is no concealment and these amounts were already disclosed, and in view thereof, they cannot be included in the block assessment. In view of the aforesaid findings of facts given by the Income Tax Appellate Tribunal, there is no merit in the above Appeal. Hence, the Appeal stands dismissed. (V.C.DAGA,J.) (V.C.DAGA,J.) (V.C.DAGA,J.) (DR.S.RADHAKRISHNAN,J.) (DR.S.RADHAKRISHNAN,J.) (DR.S.RADHAKRISHNAN,J.)