M/S. Batra Palace P. Ltd v. Commissioner Of Income Tax, Aayakar Bhawanrishi Nagar, Ludhiana, Punjab

I.T.A. No. 76 of 2010IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH I.T.A. No. 76 of 2010Date of Decision: February 16, 2010 M/s. Batra Palace P. Ltd. Versus ----Appellant Commissioner of Income Tax, Aayakar BhawanRishi Nagar, Ludhiana, Punjab. ---Respondent CORAM:HON'BLE MR. JUSTICE M.M. KUMARHON'BLE MR. JUSTICE JITENDRA CHAUHAN Present: Mr. S.K. Mukhi, Advocatefor the appellant. 1.To be referred to the Reporters or not?2.Whether the judgment should be reportedin the Digest? **** M.M. KUMAR, J. The assessee has approached this Court by invokingSection 260-A of the Income Tax Act, 1961 (for brevity 'the Act')and has challenged order dated 15.05.2009 passed by the IncomeTax Appellate Tribunal, Chandigarh Bench (A) (for brevity 'theTribunal') rendered in ITA No. 144/Chandi/2009 in respect of theassessment year 2005-06. The assessee has filed his return for the assessment year2005-06 declaring nil income. However, Assessing Officer selectedthe return for scrutiny. The assessment was finalized aftercomplying with the procedure laid down under Section 143(2) of the I.T.A. No. 76 of 2010 Act. The assessing Officer made additions of Rs. 21,09,875/-, whichwas claimed by the assessee to be expenditure of hotel buildingrepair. Another sum of Rs. 4,02,350/- was also added because theAssessing Officer found the expenditure on linen curtains, roomsupply debited to P & L account as bogus. The assessment framedby the Assessing Officer vide order dated 28.12.2007 waschallenged before the CIT(A) who upheld the order of AssessingOfficer in rejecting the books of account under Section 145 of theAct and by completing the assessment to the best of his judgment. The CIT(A) found the various cases of expenditure made bythe appellant in his books of accounts but subjected to verification,by asking the seller of those items to the appellant. The seller ofthe appellant, M/s. Tools Traders and M/s. Amit Enterprises, Delhiwere sent letters through speed post, which was received back withthe postal remarks that 'no such address'. In respect of one M/s.Amar Nath & Co., Delhi from where Bed Cover, Bed Sheet were saidto have been purchased, was contacted by the Assessing Officer ontelephone. They had denied selling any materials to the appellantnor they have any ledger account in the name of appellant in theirbooks of accounts, this was also confirmed vide letter dated21.12.2007. Accordingly, likewise communications were receivedfrom M/s. Amit Enterprises, Delhi which has been rejected by theAssessing Officer because the letter obviously sent at the instanceof the appellant, so information was sent on fresh letter page, whichdid not even carried telephone numbers nor any account numbers. I.T.A. No. 76 of 2010 The other invoices and bills are also found to be bogus. Accordingly,they claimed expenditure in respect of sum of Rs. 4,02,350/- wasfound to be bogus. Likewise, amount of Rs. 21,09,875/- asexpenses incurred on the repair and maintenance of hotel buildingwas found to be unexplainable, the genuineness of the expenditurecould not be verified from the voucher and purchase invoices. The order of CIT(A) has been upheld by the Tribunal which issubject matter of challenge in the instant appeal. Having heard learned counsel for the appellant at aconsiderable length, we find that the additions have been madeafter rejecting the books of accounts. These are necessarily findingsof fact which would not give rise to any question of law warrantingadmission of appeal. Whether the building repair and maintenancewas actually done by incurring expenditure, whether expenditurewas incurred on linen curtains, bed cover etc. would necessarily bequestions of fact. We do not find any substantive question of law warrantingadmission of appeal, accordingly the same is dismissed. (M.M. KUMAR) Judge 16[th] February, 2010Atul (JITENDRA CHAUHAN) Judge