The Commissioner Of Income Tax-Jalandhar I v. Ajay Kumar Mittal J

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH --- -Income tax Appeal No. 123 of 2004 Date of decision : 28/10/2010 The Commissioner of Income Tax-Jalandhar I - --- Appellant Versus Veena Aggarwal--- Respondent---’CORAM:HON BLE MR JUSTICE ADARSH KUMAR GOEL. ’HON BLE MR JUSTICE AJAY KUMAR MITTAL. ---Present:Mr Vivek Sethi Standing Counsel for the. , appellant.--- --- Respondent AJAY KUMAR MITTAL J, . , . -This appeal under Section 260 A of the Income tax Act,1961 (for short “the Act ”’ ) has been filed by the Revenue against theorderdated 15.12.2003, passedbytheIncome Tax AppellateTribunal Amritsar Bench Amritsar, , , ( in short “the Tribunal”) in ITA No.65/ASR/1996 in respect of the assessment year 1991-92, raising thefollowing substantial questions of law for determination by this Court:1.Whether on the facts and in the circumstances of the’case the Hon ble ITAT was right in holding that it would, be fair and just if the assessment is made at Rs.3,70,000/-. 2.Whether on the facts and in the circumstances of thecase while so holding the Hon ble ITAT was right’in lawinholdingthatreliefwasduetotheassessee forassessment year 1991-92 because income in excess ofsurrendered income was assessed for the assessmentyears 1989-90 and 1990-91.case while so holding the Hon ble ITAT was right’in lawinholdingthatreliefwasduetotheassessee forassessment year 1991-92 because income in excess ofsurrendered income was assessed for the assessmentyears 1989-90 and 1990-91. Whether Hon ble ITAT was justified in holding that the’assessee was in perturbed condition at the time of givingstatement and that the assessee was entitled to relief oncompassionate ground.assessee was in perturbed condition at the time of givingstatement and that the assessee was entitled to relief oncompassionate ground. 3. Whether on the facts and in the circumstances of the’’case while so holding the Hon ble ITAT was right in law, , in ignoring the facts that the amount surrendered at thetime of search not only included the profit from thebusiness but also unexplained stock investment made in, in ignoring the facts that the amount surrendered at thetime of search not only included the profit from thebusiness but also unexplained stock investment made in, 4. purchase of cars as also other investment on the basisof incriminating documents found at the time of search.-Briefly, the facts of the case are that the respondentassesseeandherhusband, RameshChanderAggarwal, wereengagedinthebusinessoftradinginironandsteel in theirrespective proprietorship concerns, namely, M s/ . Mahavir Iron andSteel Traders and M s/ . Katak Ram Ramji Dass, respectively. Theaffairs of both the concerns were, however, being managed by thehusband of the respondent. A search and seizure operation wascarried out at the premises of the assessee on 24.7.1990 and duringtheprocessoftheoperation, certainbooksofaccounts weremanaged to be removed which later on were claimed to have been, , lost. Ramesh Chander made voluntary surrender of certain amounts,which are as follow: 4. purchase of cars as also other investment on the basisof incriminating documents found at the time of search.-Briefly, the facts of the case are that the respondentassesseeandherhusband, RameshChanderAggarwal, wereengagedinthebusinessoftradinginironandsteel in theirrespective proprietorship concerns, namely, M s/ . Mahavir Iron andSteel Traders and M s/ . Katak Ram Ramji Dass, respectively. Theaffairs of both the concerns were, however, being managed by thehusband of the respondent. A search and seizure operation wascarried out at the premises of the assessee on 24.7.1990 and duringtheprocessoftheoperation, certainbooksofaccounts weremanaged to be removed which later on were claimed to have been, , lost. Ramesh Chander made voluntary surrender of certain amounts,which are as follow: The assessee initially filed return for the assessmentyear 1991-92 declaringincomeof Rs. 5,00,000/- which wasconsidered as invalid within the meaning of sub section (9) of Section139 of the Act. Subsequently, the assessee filed revised return on15.7.1993 showing an income of Rs. 3,00,000/- as against Rs.5,00,000/- indicating therein that she felt that the return earlier filed-by her was over estimated. The revised return was found to have-been filed beyond the period of limitation provided in sub section (4)of Section 139 of the Act. A notice was thus issued to the assessee, , under section 148 and assessment proceedings commenced againsther. In the said proceedings the assessee could not produce booksof accounts taking a plea that the same had been lost The assessing. officer on the basis of the bank account record and other materialavailable finalized the assessment at Rs. 5,00,000/- vide order dated8.3.1995, Annexure A -1, passed under Section 143(3) of the Act.-The assessee preferred appeal before the Commissioner of Incometax (Appeals) {in short “CIT A ”( ) }. The CIT A( ) on examination ofmatter came to conclusion that the order passed by the assessingofficer was legal and justified and, thus, dismissed the appeal videorder dated 26.10.1995, Annexure A -2. Aggrieved by the order of the CIT A( ), the assessee filedappealbeforetheTribunal. TheTribunal, videorder dated15.12.2003, directed the assessing officer to finalize the assessmentatRs. 3,70,000/- asagainst the amount of Rs. 5,00,000/-sustained by the CIT A( ). This is how the Revenue is in appealbefore us. We have heard learned counsel for the appellant andhave perused the record. -The husband of the respondent assessee had surrendereda sum of Rs. 12 lacs on the date of search operation. The surrenderwas Rs. 4 lacs for the assessment year 1989-90, Rs. 3 lacs for1990-91 and Rs. 5 lacs for the assessment year 1991-92. However,ultimately the addition of Rs, .4.40 lacs was made for the assessmentyear 1989-90 and Rs. 3.90 lacs for the assessment year 1990-91.ThebenefitoftheexcessamountofRs. 1,30,000/-, . . i eRs.40,000/- in respect of assessment year 1989-90 and Rs. 90,000/-relating to the assessment year 1990-91 has been allowed by theTribunal, which is under challenge in this appeal at the instance ofthe Revenue. The findings recorded by the Tribunal in this behalf areas under:“After considering the rival submissions and perusing therelevant material on record it is obvious that in so far as, presentassesseeisconcerned, thetotalamountsurrendered was at Rs. 12 lacs, which was spread overthe assessment years 1989-90 to 1991-92. As against thesurrendered income of Rs. 4 lacs and Rs. 3 lacs for theimmediatelytwoprecedingassessmentyears, thedepartment had assessed the assessee at Rs. 4.40 lacsandRs. 3.90 lacsrespectively. Since no books ofaccount were finally found in the course of search andseizure proceedings and the voluntary surrender made bySh. RameshChanderAggarwalconsequentupon the persuasion by the Deptt was at Rs. . 12 lacs spread overthree years as noted above, in such circumstances, wearesatisfiedthattheincomeinthethreerelevantassessment years should have been determined at Rs. 12lacs only. The uncontroverted position before us is that intheimmediatelyprecedingtwoassessmentyears, theassessee has been assessed at Rs. 8.30 lacs without anybooks of accounts and the balance amount that remainsto be taxed in the assessment year under considerationcomes to Rs. 3.70 lacs (Rs.12 lacs-8.30 lacs). On thecontention raised by the learned A R to the effect that the . . assesseeiswidowandherhusbandwhomade thesurrender in a perturbed condition finding to which extentis apparent from the statement u s / 132(4) is no morealive, we are satisfied that this case deserves to beconsidered on compassionate ground as well. In thepeculiar facts of the present case we are satisfied that it, would be fair and just if the assessment is made at Rs.3.70 lacs We order accordingly ”. . Learned counsel for the Revenue could not show that thebenefitofadditionbeyondthesurrenderedamount for theassessment years 1989-90 and 1990-91 . . i eRs. 40,000/- and Rs.90,000/- respectively, could not be given to the assessee in theassessment year 1991-92. The learned counsel for the Revenue wasnot able to point out any infirmity or illegality in the findings recordedby the Tribunal which may warrant interference by this Court. The Tribunal has taken a plausible view on appreciation of material onrecord. In such a situation, the findings recorded by the Tribunalcannot be faulted with. In view of the above the appeal is dismissed, . (AJAY KUMAR MITTAL)JUDGE (ADARSH KUMAR GOEL)October 28, 2010JUDGE*rkmalik*