Subhash Verma v. The Commissioner Of Income Tax

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. I.T.A. No.174 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.555/Del. of 2003(Block Period:1989-90 to 1998-99, proposing to raise following substantialquestions of law:- “(i)Whether the Tribunal misdirected itself in law as wellas on facts in sustaining the addition of Rs.6 lakhs onaccount of household expenses, in the absence ofany incriminating material having been found duringas on facts in sustaining the addition of Rs.6 lakhs onaccount of household expenses, in the absence ofany incriminating material having been found during the course of search conducted at the premises of theappellant, that too contrary to the material on record?(ii)Whether the impugned order passed by the Tribunalsustaining the addition on account of householdexpenses in the absence of any material orinformation relatable to any evidence found as a resultof search conducted on the assessee, contrary to theexpress provision of Section 158BB(1) of the IncomeTax Act, 1961? (iii)Whether the Tribunal acted in illegally and perverselyin upholding the order of CIT(A) whereby the latterhad sustained the addition of Rs.1,25,000/- towardsinvestment on account of purchase of property atKatra (J&K) by the appellant on behalf of his mother?” 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. Onappeal to the Tribunal, the findings of the Assessing Officer to theextent of issues raised in this appeal were upheld. The Tribunalobserved:- “71.We have heard the rival contentions andperused the material available on record. We findgeneral merit in the argument of learned counsel that 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. Onappeal to the Tribunal, the findings of the Assessing Officer to theextent of issues raised in this appeal were upheld. The Tribunalobserved:- “71.We have heard the rival contentions andperused the material available on record. We findgeneral merit in the argument of learned counsel that the household withdrawals of each year having beenshown in the regular return; the adequacy thereofbecomes subject matter of regular assessment andnot block assessment. Besides, it has not beendisputed that except above no other incriminatingmaterial in respect of undisclosed householdwithdrawals was found during the course of search.Coming to the aspect of the education expenses ofthe assessee’s son, Shri Sanjay Verma on hisengineering studies in Maharashtra, assessee did notgive satisfactory reply. During the course of enquiryrelating to search, assessee himself admitted that hisson was undertaking engineering studies at Pune,therefore, this fact becomes part of the enquiries.Since this expenditure has not been shown andassessee does not give satisfactory reply, properintervention is called for. In view of these facts, wefind no infirmity in the order of CIT(A) reducing theaddition to Rs.6 lacs. The issue of regular assessmentin this case does not arise as the assessee has notshown any specific expenditure about the son’seducation in regular returns and the information wasgathered by AO during the course of search on thefacts revealed by the assessee himself. Therefore,the part retention of Rs.6 lacs cannot be the assesseehimself. In view thereof, the order of CIT(A) isupheld.”xxxxxxxxxx“76. We see no infirmity in the order of CIT(A)inasmuch as the collection of offerings to deity assource of investment is on the basis of hearsay andoral contention, the addition being on the basis ofseized document, the investment in the property at Katra in the name of assessee’s mother has to betreated as undisclosed income.....” 3. We have heard learned counsel for the Assessee. 4. The finding concurrently recorded by the AssessingOfficer and the Tribunal on the issue of additions made, inquestion, not being perverse, no substantial question of law arise. The appeal is dismissed. (ADARSH KUMAR GOEL) JUDGE July 22, 2010ashwani ( AJAY KUMAR MITTAL ) JUDGE