Subhash Verma v. The Commissioner Of Income Tax

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. I.T.A. No.175 of 2010Date of decision: 22.7.2010 Subhash Verma. Vs. The Commissioner of Income Tax. -----Appellant. -----Respondent CORAM:- HON'BLE MR. JUSTICE ADARSH KUMAR GOELHON'BLE MR. JUSTICE AJAY KUMAR MITTAL Present:-Mr. Sanjay Bansal, Sr. Advocate withMs. Shaveta Malhotra, Advocatefor the appellant.Ms. Shaveta Malhotra, Advocatefor the appellant. --- ADARSH KUMAR GOEL, J. 1. This appeal has been preferred by the Assesseeunder Section 260A of the Income Tax Act, 1961 (for short, “theAct”) against order of the Income Tax Appellate Tribunal, NewDelhi in Appeal No.I.T.(SS).A.No.552/Del. of 2003(Block Period:1989-90 to 1998-99, proposing to raise following substantialquestions of law:- “(i)Whether the Tribunal acted illegally and perversely inreversing the order of the CIT(A) whereby the latterhad deleted the addition of Rs.5,68,000/- in respect ofconstruction?reversing the order of the CIT(A) whereby the latterhad deleted the addition of Rs.5,68,000/- in respect ofconstruction? (ii)Whether the Tribunal misdirected itself in law as wellas on facts in recording its conclusion based onirrelevant findings and in ignoring uncontrovertedrelevant material on record?as on facts in recording its conclusion based onirrelevant findings and in ignoring uncontrovertedrelevant material on record? (iii)Whether the impugned order passed by the Tribunalis perverse and a result of non application of mind andmisreading of evidence on record?”is perverse and a result of non application of mind andmisreading of evidence on record?” 2. The Assessee is a property dealer. On search of hispremises, various documents were found depicting undisclosedincome of the Assessee. During assessment for the block periodin question, additions were made on account of estimatedcommission income besides properties of the assessee. TheAssessing Officer added cost of construction which was notreflected in the books of account. The same was accepted by theCIT(A) but was reversed by the Tribunal. The Tribunal held:- “49. Apropos Ground No.6 i.e. cost of construction,AO from the material seized during the course ofsearch including copy of judgment of Civil Judge i.e.Document No.A-14 held that the assessee hasconstructed six rooms for his residential purposes andfive shops, the fact is not denied by the assessee.The claim is that the six rooms were purchased alongwith the plot in weak condition and five shops aretemporary structures. In our view, the assessee’sreply is not substantiated, a copy of contractor BhimSingh is found during the course of search along withvarious other bills etc. suggesting purchase of buildingAO from the material seized during the course ofsearch including copy of judgment of Civil Judge i.e.Document No.A-14 held that the assessee hasconstructed six rooms for his residential purposes andfive shops, the fact is not denied by the assessee.The claim is that the six rooms were purchased alongwith the plot in weak condition and five shops aretemporary structures. In our view, the assessee’sreply is not substantiated, a copy of contractor BhimSingh is found during the course of search along withvarious other bills etc. suggesting purchase of building material. The plea that six rooms were bought alongwith plot is not worthy of acceptance as the sale deedclearly indicates that these rooms were in “dilapidatedconditions”. Similarly, Civil Judge record indicatespucca construction whereas assessee on oralargument contends it to be temporary structuresbecause of HUDA policy, which cannot be accepted.In our view, as this construction of pucca house andshops was not disclosed, CIT(A) was not correct indeleting addition of Rs.5,68,000/- in respect ofconstruction.....” 3. We have heard learned counsel for the Assessee. material. The plea that six rooms were bought alongwith plot is not worthy of acceptance as the sale deedclearly indicates that these rooms were in “dilapidatedconditions”. Similarly, Civil Judge record indicatespucca construction whereas assessee on oralargument contends it to be temporary structuresbecause of HUDA policy, which cannot be accepted.In our view, as this construction of pucca house andshops was not disclosed, CIT(A) was not correct indeleting addition of Rs.5,68,000/- in respect ofconstruction.....” 3. We have heard learned counsel for the Assessee. 4. In view of the finding recorded by the Tribunal on theissue of additions, not being perverse, no substantial question oflaw arise. The appeal is dismissed. (ADARSH KUMAR GOEL) JUDGE July 22, 2010ashwani ( AJAY KUMAR MITTAL ) JUDGE