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2009 Supreme(Pat) 1152
PATNA HIGH COURT
S.K.Katriar and Jyoti Saran JJ.
Pradip Kumar Saravgi
Versus
Commissioner Of Ln-...Assessing Officer/ Come-tax-l
MISCELLANEIOUS Appeal No. 189 of 2003
Decided On : AUGUST 26, 2009
The court's decision emphasized the narrow scope of interference with the findings of fact by the appellate authorities and the requirement for a substantial question of law to justify such interference.
Headnote:
Income Tax Act - Assessment of Income - Section 143(2), Section 246A, Section 253 - The judgment discusses the assessment of income for the assessment year 1998-99 under the Income Tax Act. The court considered three transactions of purchase and the discrepancies in the accounts submitted by the assessee. The court upheld the findings of the authorities regarding the addition of certain amounts to the total income of the assessee.
Fact of the Case:
The assessee, engaged in the business of textiles products, submitted returns for the assessment year 1998-99. The Assessing Officer recorded discrepancies in three purchase transactions and added the amounts to the total income of the assessee. The appellate authorities upheld the findings of the Assessing Officer.
Finding of the Court:
The court upheld the findings of the authorities regarding the addition of the disputed amounts to the total income of the assessee, concluding that the findings of facts recorded by the authorities were consistent and not perverse.
Issues: The issues revolved around the discrepancies in the purchase transactions and the addition of the amounts to the total income of the assessee.
Ratio Decidendi: The court concluded that the findings of facts recorded by the authorities were consistent and not perverse, and therefore, did not constitute a question of law, let alone a substantial question of law.
Final Decision: The appeal was dismissed, and no costs were awarded to either party.
S.K.Katriar and Jyoti Saran JJ.
1. The assessee (the appellant herein) has preferred this appeal under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as the Act), and is directed against the order dated 17.12.2002, passed by the Income Tax Appellate Tribunal, Patna Bench, at Patna, in ITA No.27 Patna/2002, whereby the assessees appeal in terms of Section 246A of the Act has been rejected, and the orders of the learned Assessing Officer and the appellate authority have been upheld. This case is concluded by concurrent findings of fact and relates to assessment year 1998-99.
2. The assessee is engaged in the business of textiles products and is engaged in retail business at Dehri-On-Sone, District-Rohtas at Sasaram. It submitted its returns for the assessment year 1998-99, and decision was taken for detailed scrutiny of the same. Therefore, notice in terms of Section 143(2) was issued to the assessee. The learned Deputy Commissioner of Income Tax, being the Assessing Officer, recorded three transactions of purchase relevant in the present context. He found that the three payments made to Aditi Synthetics, Bhilwara (Rajasthan), by three different demand drafts were really not paid for the purchases made by. the assessee from Aditi Synthetics. The learned Assessing Officer, therefore, concluded the same to be income escaping assessment and has, therefore, added it to the total income of the assessee totalling Rs. 2,10,101/-. The assessment order was passed in terms of Section 143(2) of the Act.
2.1. The second transaction under consideration was purchase made from one M/s Woolen House. The accounts submitted by the assessee had shown a balance sum of Rs. 54,993/- against Woolen House, whereas the account sent by M/s Woolen House had shown Rs. 42,990/-. The learned Assessing Officer, therefore, concluded that the assessee has shown Rs. 12,003/- as excess credit standing in the name of M/s Woolen House and, therefore, treated the differential amount as unexplained and added the same to the total income of the assessee.
2.2. The third transaction under consideration was purchase of textiles materials from M/s G.K. Synthetics and M/s S.K. Bross. The learned Assessing Officer came to the conclusion that the assessee had understated the purchase from these two parties to the extent of Rs. 11,835/-, and thereby payments made to them remained out of books. Therefore, the same amount i.e. Rs. 11,835/-, added to the total income of the assessee.
3. Aggrieved by the order of assessment, the assessee preferred appeal before the learned Commissioner of Income Tax (Appeals) in terms of Section 246A of the Act. By order dated 19.11.2001, the appeal was dismissed and the aforesaid findings of facts recorded by the learned Assessing Officer have been upheld.
4. Aggrieved by the order of the learned appellate authority, the assessee preferred appeal before the Income Tax Appellate "Tribunal in terms of Section 253 of the Act which has been rejected by order dated 17.12.2002, and the findings of facts recorded by the two authorities have been upheld.
5. This appeal was admitted by order dated 16.11.2006, and the following sub-stantial question of law was formulated for consideration
"Whether on the facts and in the circumstances of the appellants case the Tribunal was justified in confirming the findings of CIT(A) with regard to addition of Rs. 2,10,101/-, Rs. 12,003/- and Rs. 11,835/- by ignoring the evidence/material on record?"
6. While assailing the validity of the impugned order, learned counsel for the assessee submits that the three authorities have made a perfunctory scrutiny of the evidence on the first issue, and has erroneously held that the said sum of Rs. 2,10,101/- as income, escaping assessment and has erroneously added the same to the income of the assessee. Learned counsel for the assessee has also assailed the validity of findings of facts with respect to the remaining two issues on identical grounds.
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