C.I.T vs. SHRI RAM GOPAL AGARWAL

IN THE HIGH COURT OF DELHI AT NEW DELHI . ITA 341/2008 . C.I.T ..... Appellant Through Mrs. P.L. Bansal, Adv. . versus . SHRI RAM GOPAL AGARWAL ..... Respondent Through Mr. Abhishek Maratha, Adv. . CORAM: HON'BLE MR. JUSTICE MADAN B. LOKUR HON'BLE MR. JUSTICE MANMOHAN SINGH . O R D E R 25.04.2008 . Learned counsel for the Revenue has raised two issues before us. In respect of the first issue, it is submitted that the value of the property in Sainik Farms, as per the report given by the District Valuation Officer, was much higher than what was disclosed by the Assessee. It was admitted before the Commissioner of Income Tax (Appeals) [CIT(A)] as well as before the Income Tax Appellate Tribunal (the Tribunal) that no incriminating document was found during the course of search which could suggest any sort of investment made in the Sainik Farms property by the Assessee. . ITR 341/2008 Page 1 of 3 It has been noted by the Tribunal, by relying upon a judgment of the Madhya Pradesh High Court in Commissioner of Income Tax v. Khushlal Chand Nirmal Kumar, [2003] 263 ITR 77 that for the purposes of Chapter XIV-B of the Income Tax Act, 1961 evidence must be found during search, which would lead to a conclusion that the Assessee had some undisclosed income. The Madhya Pradesh High Court also referred to a Circular issued by the Central Board of Direct Taxes being Circular No.8 of 202 dated 27th August, 2002 in which it has been mentioned that block assessment of undisclosed income is to be based on the evidence found during the search and material or information gathered in post-search inquiries made on the basis of evidence found during the search. . . This Court has taken a view similar to that taken by the Madhya Pradesh High Court in L.R. Gupta and Others v. Union of India and Others, [1992] 194 ITR 32 and Commissioner of Income Tax v. Ravi Kant Jain, [2001] 250 ITR 141 and several other decisions following these two decisions. Insofar as the present case is concerned, there was no material found during the course of the search which would lead to a conclusion of undisclosed income in respect of the property at Sainik Farms. It is only on . ITR 341/2008 Page 2 of 3 the basis of the return filed by the Assessee followed by the report of the District Valuation Officer that the Assessing Officer concluded that there was some undisclosed income in respect of the property at Sainik Farms. Under the circumstances, insofar as this issue is concerned, no substantial question of law arises for consideration. Learned counsel for the Revenue says that she would like to look into the issue regarding apportionment of undisclosed income of Rs.10,59,700/-. Limited to submissions on this issue, the matter is adjourned to 10th November, 2008. . . MADAN B. LOKUR, J . . . MANMOHAN SINGH, J APRIL 25, 2008 vk . . . . . . . . . . . . . ITR 341/2008 Page 3 of 3 .