The Commissioner Of Income Tax-Iii, Ludhiana v. Sh. Gurlal Singh Grewal, 655 Gurdev Nagar, Ludhiana

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of Decision: January 29, 2013 ITA No.297 of 2012 (O&M) The Commissioner of Income Tax-III, Ludhiana …Appellant Versus Sh. Gurlal Singh Grewal, 655 Gurdev Nagar, Ludhiana. …Respondents CORAM:HON'BLE MR. JUSTICE HEMANT GUPTA HON’BLE MS. JUSTICE RITU BAHRI Present:Mr. Rajesh Katoch, Advocatefor the appellant. 1To be referred to the Reporters or not?2Whether the Judgment should be reported in theDigest2Whether the Judgment should be reported in theDigest HEMANT GUPTA, J. (Oral) The present appeal under Section 260-A of theIncome Tax Act, 1961 (for short 'the Act') is directed againstorder dated 29.08.2012 passed by the Income Tax AppellateTribunal, Chandigarh Bench, Chandigarh (for short the Tribunal)pertaining to assessment year 2006-07. The Revenue has claimed the following substantial questions of law: “i)Whether on the facts and circumstances of thecase, the Hon'ble Income Tax Appellate Tribunal isjustified in disallowing the addition of ` 67,96,725/-(` 64,00,000/- + 3,96,725/- int.) made by the AO onaccount of unexplained investment by ignoring thefact that the assessee failed to discharge the onus ofproof that noting contained on the piece of paper didcase, the Hon'ble Income Tax Appellate Tribunal isjustified in disallowing the addition of ` 67,96,725/-(` 64,00,000/- + 3,96,725/- int.) made by the AO onaccount of unexplained investment by ignoring thefact that the assessee failed to discharge the onus ofproof that noting contained on the piece of paper did not relate to any transaction. ii)Whether on the facts and circumstances of thecase, the Hon'ble Income Tax Appellate Tribunal isjustified in disallowing the addition made by the AOby ignoring the facts that destroying the paper inquestion which was reproduced later on, establishesmens rea on the part of the assessee to destroy theevidence against him.” The entire claim of the Revenue is based upon thepaper recovered during survey on 22.02.2006. The assesseeearlier sought to destroy the said paper, but later it was re-constructed. The Tribunal has returned a finding that the saiddocument does not show anything and it is very difficult to saythat the document represents certain loans given by theassessee to various persons. The Tribunal has also returned afinding that after discovery of the document during survey, theRevenue should have either obtained further information or inany case should have conducted more enquiries to prove thecontents of the document and that without such enquiry or anymaterial on record, it is not possible to return a finding that thefigures are in terms of lakhs and lead to addition to income. We have asked learned counsel for the appellant to explain that the entries so recorded relate to transaction ofmoney. It is argued that conduct of the assessee during thecourse of survey would cause inference that assessee washiding transaction when he tried to destroy the paper. Theargument is based upon presumption and not on fact. Therefore,in view of the finding of fact recorded by the Tribunal that thepaper does not lead to any transaction of money, we do not find that any substantial question of law arises for consideration ofthis court. Dismissed. (HEMANT GUPTA) JUDGE 29.01.2013Atul/Vimal (RITU BAHRI) JUDGE