- (1.) THE present appeal is filed against the judgment and order dated May 26, 2006, passed by the Income -tax Appellate Tribunal, Allahabad, in I.T.R. No. 464/Alld./05 for the block period April 1, 1996, to September 4, 2002. On May 15, 2012, a co -ordinate Bench of this court has admitted the appeal on the following substantial question of law : Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the case of the assessee (respondent) was covered by clause (c) of sub -section (1) of section 158BB of the Income -tax Act, 1961, and not under clause (ca) of sub -section (1) of section 158BB of the said Act and in setting aside the order of the Commissioner of Income -tax under section 263 of the Income -tax Act, 1961, and in upholding the reduction made by the Assessing Officer in respect of the income shown in the belated return for the assessment year in question from the block assessment in respect of the assessee (respondent)?
(2.) THE brief facts of the case are that on April 9, 2002, a search and seizure operation was carried out at the business and residential premises of the assessee where some incriminating material was seized. Block assessment under section 158BC was completed on March 30, 2004, for an undisclosed income of Rs. 1,48,94,580. On September 1, 2004, the assessee had filed a regular return for the assessment year 2002 -03 (which falls within the block period) by showing the income of Rs. 53,27,812. The same was accepted by the Assessing Officer. However, on April 19, 2005, the Commissioner of Income -tax, after issuing a proper notice, has passed an order under section 263 of the Income -tax Act and rejected the claim of the assessee for the income of Rs. 53,27,812 shown for the assessment year 2002 -03 by observing that the return was filed belatedly. The full advance tax was not paid. Finally, the Commissioner of Income -tax has directed the Assessing Officer not to allow the claim of the assessee for the disclosed income 2002 -03 to the tune of Rs. 53,27,812. Being aggrieved, the assessee has filed an appeal before the Tribunal.
(3.) THE Tribunal has allowed the claim of the assessee by observing that partial advance tax was paid, return was filed within the extended time allowed under section 139 of the Income -tax Act. The assessee was maintaining proper books of account. Not being satisfied the Department has filed the present appeal.;