Undisclosed income to be computed on basis of principle of Real Income: ITAT dismisses appeal filed by Revenue

The ITAT dismissed the Revenue’s appeal, ruling that undisclosed income should be computed based on the principle of real income. The case involved the assessee’s income, which was not properly disclosed in the initial assessments. The Tribunal emphasized that the principle of real income applies when determining undisclosed income, meaning only actual, realizable income should be considered for taxation, not hypothetical or unearned amounts. The ruling serves to protect taxpayers from over-taxation based on speculative income figures, reinforcing that tax assessments must be grounded in real, provable income.