Commissioner Of Income Tax, Karnal v. Sh. Ramneet Singh

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. I.T.A. No. 515 of 2007DATE OF DECISION : 13.02.2008 Commissioner of Income Tax, Karnal .... APPELLANT Versus Sh. Ramneet Singh ..... RESPONDENT CORAM :- HON'BLE MR. JUSTICE SATISH KUMAR MITTALHON'BLE MR. JUSTICE RAKESH KUMAR GARG Present:Mr. Yogesh Putney, Advocate, for the appellant-revenue. * * * SATISH KUMAR MITTAL, J. The instant appeal filed by the revenue under Section 260-A of the Income Tax Act, 1961 (hereinafter referred to as `the Act') is directedagainst the order dated 3.11.2006 passed by the Income Tax AppellateTribunal, Delhi Bench `E' Delhi (hereinafter referred to as `the ITAT'') inITA No. 4878 (Del) 2004 in case of the respondent for the Assessment Year1997-98, by raising the following substantial questions of law :- (i) Whether on the facts and in the circumstances of the case,the learned ITAT was right in law in upholding the order ofthe CIT (A) in deleting the addition of Rs. 1,53,500/- onaccount of unexplained cash credits?the learned ITAT was right in law in upholding the order ofthe CIT (A) in deleting the addition of Rs. 1,53,500/- onaccount of unexplained cash credits? (ii) Whether on the facts and in the circumstances of the case,the learned ITAT was right in law in upholding the order ofthe CIT (A) in deleting the addition of Rs. 1,00,000/- madeby the Assessing Officer, on account of unexplainedinvestment in purchase of a bus?the learned ITAT was right in law in upholding the order ofthe CIT (A) in deleting the addition of Rs. 1,00,000/- madeby the Assessing Officer, on account of unexplainedinvestment in purchase of a bus? (iii)Whether on the facts and in the circumstances of the case,the learned ITAT was right in law in upholding the order ofthe CIT (A) in deleting the addition of Rs. 3,87,696/- madeby the Assessing Officer, on account of unexplained loansshown in the names of M/s TATA Finance Co., and M/sSuper Travels by entertaining additional evidence, whichwas not produced before the Assessing Officer during theassessment proceedings contrary to the provisions of Rule46A of the Income Tax Rules?the learned ITAT was right in law in upholding the order ofthe CIT (A) in deleting the addition of Rs. 3,87,696/- madeby the Assessing Officer, on account of unexplained loansshown in the names of M/s TATA Finance Co., and M/sSuper Travels by entertaining additional evidence, whichwas not produced before the Assessing Officer during theassessment proceedings contrary to the provisions of Rule46A of the Income Tax Rules? (iv)Whether on the facts and circumstances of the case, theorder passed by the learned ITAT dated 3.11.2006 isperverse as the findings recorded are contrary to evidenceon record?order passed by the learned ITAT dated 3.11.2006 isperverse as the findings recorded are contrary to evidenceon record? (v) Whether on the facts and circumstances of the case, theorder passed by the learned ITAT is legally sustainable inthe eyes of law as no reasons whatsoever have beenrecorded while dismissing the appeal of the revenue?order passed by the learned ITAT is legally sustainable inthe eyes of law as no reasons whatsoever have beenrecorded while dismissing the appeal of the revenue?In the present case, the Assessing Officer, while affirming the (iv)Whether on the facts and circumstances of the case, theorder passed by the learned ITAT dated 3.11.2006 isperverse as the findings recorded are contrary to evidenceon record?order passed by the learned ITAT dated 3.11.2006 isperverse as the findings recorded are contrary to evidenceon record? (v) Whether on the facts and circumstances of the case, theorder passed by the learned ITAT is legally sustainable inthe eyes of law as no reasons whatsoever have beenrecorded while dismissing the appeal of the revenue?order passed by the learned ITAT is legally sustainable inthe eyes of law as no reasons whatsoever have beenrecorded while dismissing the appeal of the revenue?In the present case, the Assessing Officer, while affirming the assessment of the assessee made certain additions on different grounds.Subsequently, the assessee filed an application for rectification. Whileallowing the said application, some of the additions were deleted.Thereafter, feeling aggrieved against the remaining additions made by theAssessing Officer, the assessee filed appeal before the Commissioner ofIncome Tax (Appeals), Karnal [hereinafter referred to as `the CIT (A)], whovide his order dated 14.9.2004, while deleting the said additions came to theconclusion that the documents relating to the loan were produced by theassessee before the Assessing Officer during rectification proceedings, butthe same were not considered on the ground that there is no mistakeapparent on the record. Against the said order, the revenue filed appealbefore the ITAT, raising the following grounds : (i) On facts and in the circumstances of the case, the learnedCIT (A) has erred in law in deleting the addition of Rs.1,53,500/- on account of unexplained cash credits as theassessee failed to produce the alleged creditors before theAO in spite of being given opportunity and the identity ofthe creditors remained unproved.CIT (A) has erred in law in deleting the addition of Rs.1,53,500/- on account of unexplained cash credits as theassessee failed to produce the alleged creditors before theAO in spite of being given opportunity and the identity ofthe creditors remained unproved. (ii) On facts and in the circumstances of the case, the learnedCIT (A) has erred in law in deleting the addition ofRs.1,00,000/- made by the Assessing Officer on account ofunexplained investment in purchase of bus.CIT (A) has erred in law in deleting the addition ofRs.1,00,000/- made by the Assessing Officer on account ofunexplained investment in purchase of bus. (iii)On facts and in the circumstances of the case, the learned CIT (A) has erred in deleting the addition of Rs. 3,87,696/-made on account of unexplained loans shown in the namesof M/s Tata Finance Co., and M/s Super Travels byentertaining additional evidence which was not producedbefore the Assessing Officer during the assessmentproceedings contrary to the provisions of Rule 46A of theIncome Tax Rules. (ii) On facts and in the circumstances of the case, the learnedCIT (A) has erred in law in deleting the addition ofRs.1,00,000/- made by the Assessing Officer on account ofunexplained investment in purchase of bus.CIT (A) has erred in law in deleting the addition ofRs.1,00,000/- made by the Assessing Officer on account ofunexplained investment in purchase of bus. (iii)On facts and in the circumstances of the case, the learned CIT (A) has erred in deleting the addition of Rs. 3,87,696/-made on account of unexplained loans shown in the namesof M/s Tata Finance Co., and M/s Super Travels byentertaining additional evidence which was not producedbefore the Assessing Officer during the assessmentproceedings contrary to the provisions of Rule 46A of theIncome Tax Rules. Regarding ground No.1, the ITAT has affirmed the order ofCIT (A) while observing that the creditors were produced and theirstatements were recorded and in their statements, the creditors haveconfirmed having advanced loan to the assessee. It was held that in view ofthis material, the Assessing Officer was not justified in making addition ofRs. 1,53,500/- on account of unexplained cash credits. Regarding groundNo.2, it was observed that the Assessing Officer estimated the value ofvehicles like bus, mini bus, etc. at Rs. 11 lakh as against Rs. 10 lakh offeredby the assessee, without there being any basis to arrive at such conclusion.Therefore, it was found that the CIT (A) was fully justified in deleting theaddition of Rs. 1 lakh on that account. Regarding ground No.3, it wasobserved that the assessee has produced sufficient documents during theappellate proceedings to show that the loan shown in the name of M/s TataFinance Co. and M/s Super Travels has been received from these parties,therefore, there was no justification to add this amount on account ofunexplained loans. In our opinion, in this appeal, no substantial question of law isarising, as the ITAT has affirmed the finding of fact recorded by the CIT(A), while taking into consideration the material available on the record.Therefore, we do not find any ground to interfere in this appeal. Dismissed. ( SATISH KUMAR MITTAL )JUDGE February 13, 2008 ndj ( RAKESH KUMAR GARG )JUDGE