Commissioner of Income Tax vs J.P.M. Farms (Pvt.) Ltd.

Badar Durrez Ahmed, J.—This appeal arises from the order passed by the Tribunal on 3.11.2006 in IT (SS) Appeal No. 58(del) of 2004 and pertains to the block assessment year 1.4.1990 to 19.3.2001. The ground of appeal before the Tribunal was:

That the ld. CIT (Appeals) has erred in upholding the levy of surcharge on the tax payable found on the undisclosed income computed in block assessment.

As per the facts indicated in the Tribunal''s order, a search had been carried out on 19.3.2001. The proviso to Section 113 of the Income Tax Act, 1961 was inserted w.e.f 1.6.2002 whereby surcharge was sought to be levied on tax payable on undisclosed income determined in a block assessment. The Tribunal followed the decision of the Special Bench of the Income Tax Appellate Tribunal, Hyderabad in the case of Merit Enterprises v. DCIT and came to the conclusion that surcharge was not leviable in the present case and consequently, deleted the surcharge which had been levied by the revenue authorities.

In this background, the revenue has proposed the following question:

Whether the ITAT was correct in law in holding that the surcharge u/s 113 of the Income Tax Act, 1961 was not leviable in the present case?

Admit.

This issue does not require any further investigation on the part of this Court in view of the fact that the same stands decided by the Supreme Court in the case of Commissioner of Income Central II Vs. Suresh N. Gupta, . Consequently, this question is decided in favour of the revenue and against the assessee. The appeal stands allowed.