Https://Hcservices.ecourts.gov.in/Hcservices v. Acitreported In (2018) 407 Itr 0212 (Mad) And Decision Of The Highcourt Of Bombay In The Case Of Jivatlal Purtapshi Vs. Cit,Reported In (196

IN THE HIGH COURT OF JUDICATURE AT MADRAS CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMandTHE HONOURABLE MRS.JUSTICE PUSHPA SATHYANARAYANA T.C.A.No.410 of 2020 Commissioner of Income Tax,Circle 1,Namakkal. ..AppellantVersus M/s.K.K.P.Spinning Mills Private LimitedNo.88, KKP Building,Salem Road,Namakkal 637 001 PAN:AAACK 8959 K ..Respondent Prayer:- Tax Case Appeal filed under Section 260-A of the IncomeTax Act, 1961, against the order of the Income Tax AppellateTribunal, Chennai 'D' Bench, dated 30.09.2019 made inI.T.A.No.2880/Chny/2018 relating to the Assessment Year 2014-15against the order of the Assistant Commissioner of Income Tax,Circle-1, Namakkal, dated 31.07.2018 and made in ITA No.E-34/2016-17 for the Assessment year 2014-2015 and against theAssessment order of the Assistant Commissioner of Income Tax,circle-1, Namakkal dated 29.12.2016 and made in PANNO.AAACK8959K for the Assessment year 2014-2015. For Appellant: Mr.M.Swaminathan Senior Standing counsel For Respondent : Mr.R.Sivaraman JUDGMENT [Order of the Court was made by T.S.SIVAGNANAM, J.]This appeal has been filed by the Revenue under Section 260A of the Income Tax Act, 1961 ('the Act' for brevity), isdirected against the order dated 30.09.2019 passed by the IncomeTax Appellate Tribunal, Chennai, 'D' Bench ('the Tribunal' forbrevity) in I.T.A.No.2880/Chny/2018 for the Assessment Year2014-15. The Revenue has raised the following SubstantialQuestions of Law for consideration: “1. Whether the Tribunal was right in deletingthe addition made u/s.68 by the Assessing officer whenthe assessee has not produced the Name, Address & PAN https://hcservices.ecourts.gov.in/hcservices/ of the so called parties/Commission agents during theassessment proceedings?2. Whether the Tribunal was right in deleting theaddition made u/s.68 by the Assessing officer when theassessee has not proved the cash deposit but changedits stand that the payments were received from variousparties and commission agents when such ledgeraccounts were not maintained by the assessee?” 2. We have heard Mr.M.Swaminathan, learned Senior Standingcounsel appearing for the appellant/Revenue and Mr.R.Sivaraman,learned counsel for the respondent/assessee. 3. The assessee is a Spinning Mill, filed their return ofincome for the Assessment Year under consideration, returning atotal income of Rs.1,73,75,250/- under normal computation andhas shown deemed total income of Rs.3,05,28,343/- under Section115JB of the Act and claimed refund of Rs.5,54,620/-. Theassessee also declared agricultural income of Rs.2,07,030/-. Thecase was selected for scrutiny and notice under Section 143(2)of the Act was issued. During the scrutiny assessment, theassessee had furnished the details of the Bank Account, onperusal of which the Assessing Officer found cash deposits weremade. The assessee was called upon to explain such cash depositsand they stated that they received the same from the Tamil NaduHandloom Weavers Co-operative Society, Chennai. The assesseealso furnished further details and ultimately, the AssessingOfficer held that the assessee has failed to discharge theprimary onus of substantiating the credits by submittingconfirmation / ledger account copy of the Tamil Nadu HandloomWeavers Co-operative Society, Chennai and also made certainother findings and ultimately, rejected the explanation offeredby the assessee and completed the assessment under Section 143(3) of the Act on 29.12.2016, holding that a sum ofRs.6,71,19,385/- as unexplained credit under Section 68 of theAct. 4. Aggrieved by such order, the assessee preferred appeal tothe Commissioner of Income Tax (Appeals), Salem ['CIT(A)' forbrevity]. The CIT(A) called for a remand report, which wassubmitted by the Assessing Officer and after taking note of theremand report, the assessee was given partial relief and theaddition to the extent of Rs.4,67,11,382/- was deleted and theappeal was allowed in part. Aggrieved by the same, the Revenuepreferred appeal before the Tribunal, which was dismissed on theground that the Revenue's appeal is not maintainable. Thoughsuch was the finding rendered by the Tribunal, before us, theRevenue has raised the aforementioned Substantial Questions ofLaw, which pertain only to the deletion of the addition madeunder Section 68 of the Act. 5. We have elaborately heard Mr.M.Swaminathan, learnedSenior Standing counsel for the appellant / Revenue. Though theTribunal has rejected the appeal filed by the Revenue on theground of maintainability and in this regard, referred to thedecision of this Court in the case of B.Jayalakshmi Vs. ACITreported in (2018) 407 ITR 0212 (Mad) and decision of the HighCourt of Bombay in the case of Jivatlal Purtapshi Vs. CIT,reported in (1967) 65 ITR 261 and the decision of the High Courtof Mysore in the case of M.M.Annaiah Vs. CIT, reported in (1970)76 ITR 0582 and ultimately, rejected the appeal filed by theRevenue as not maintainable. 6. Before us, Mr.M.Swaminathan, learned Senior Standingcounsel appearing for the appellant / Revenue, has elaboratelyargued the question of maintainability and submitted that thedecision in the case of B.Jayalakshmi (cited supra) is onentirely different set of facts and circumstances and the samecould not have been applied to the assessee's case. As pointedout by us earlier, the Substantial Questions of Law raisedbefore us are only with regard to the deletion of the additionmade under Section 68 of the Act and technically, we are notrequired to go into the aspect, whether the appeal filed by theRevenue was maintainable before the Tribunal. With regard to thedeletion of the addition made under Section 68 of the Act, aspointed out earlier, the CIT(A) granted partial relief to theassessee. This relief was granted to the assessee based upon anelaborate remand report filed by the Assessing Officer which hasbeen extracted in the order passed by the CIT(A) dated31.07.2018. The CIT(A) / the First Appellate Authority has re-examined the entire factual position and granted relief to theassessee to the extent warranted. The assessee was not on appealas against the disallowed portion and it was only the Revenuewhich challenged the order before the Tribunal to consider thefactual scenario. We find that there is no question of law muchless Substantial Question of Law, arising for consideration inthis appeal and consequently, the appeal should fail. Withregard to the issue regarding the maintainability of the appealbefore the Tribunal, we refrain from expressing any opinion onthe said issue as in our considered opinion, it is an arguableissue and the Revenue having not raised any SubstantialQuestions of Law on the said issue, we proposed to leave thesaid question open. 7. In the result, the Tax Case Appeal is dismissed on theground that no Substantial Questions of Law as framed by theRevenue arises for consideration in this appeal. With regard tothe maintainability of the appeal filed by the Revenue beforethe Tribunal, which was held to be not maintainable since the said issue does not arise for consideration in this appeal, weleave the question open. No costs. Sd/- Assistant Registrar //True Copy//Kak Sub Assistant RegistrarTo1. The Income Tax Appellate Tribunal,'D' Bench, Chennai.2. The Commissioner of Income Tax,Circle-1, Namakkal.3. The Assistant Commissioner of Income Tax,Circle-1, Namakkal.+1cc to Mr.M.Swaminathan, Advocate, S.R.No.38567T.C.A.No.410 of 2020pa(CO)rv(20/01/2021)