PARVEEN KUMAR vs. COMMISSIONER OF INCOME TAX, AAYAKAR BHAWAN, RISHI NAGAR, LUDHIANA.

ITA/453/2017HC Punjab & HaryanaPHHC01117672201716 March 2018Author: MR. JUSTICE M.M. AGGARWAL,LOK ADALAT BENCH - 38 pages
AI SummaryDismissed

What were the facts?

The assessee, Parveen Kumar, filed an appeal against an order of the Income Tax Appellate Tribunal (ITAT) for the assessment year 2011-12. The Assessing Officer (AO) made additions of ₹20,49,420 and ₹14,40,000, representing cash deposited in bank accounts as income from undisclosed sources. The Commissioner of Income Tax (Appeals) dismissed the assessee's appeal. The ITAT partly allowed the appeal, reducing the first addition by ₹5 lakh but affirming the second addition. The assessee's return declared only salary income. The AO's additions were based on cash deposits in bank accounts, including a joint account with his maternal grandfather. The assessee contended that the cash deposits were from salary earnings and accumulated funds from previous years.

What did the High Court hold?

The High Court held that the questions raised were primarily questions of fact concerning the appreciation of evidence, not substantial questions of law. Regarding the first issue (addition of ₹15,49,420), the Tribunal re-appreciated the evidence and concluded that while some benefit for re-deposits and accumulated funds was given, there was no specific evidence to support the opening balance or explain the cash deposits. The Tribunal found no support for re-deposits from the salary account. The Court found no interference called for in the Tribunal's findings affirming the addition. Concerning the second issue (addition of ₹14,40,000 in the joint account), the Court noted the assessee's initial denial of the account, his explanation of assisting his elderly grandfather, and the fact that the grandfather's income was minimal. The Court found that the additional evidence produced before the CIT(A) and the Tribunal did not substantiate the claim, and the capital account was self-serving. The Court held that the Tribunal's view was a possible view and not perverse, and the question was not one of law. For issues (iii) and (iv), the Court found no application for additional evidence before the Tribunal, and the capital account lacked basis. The Court concluded that no perversity was established, the issues were of fact appreciation, and the conclusions were logical. The appeal was dismissed.

What were the issues?

1. Whether the ITAT was justified in confirming an addition of ₹15,49,420 (original addition ₹20,49,420 reduced by ₹5 lakh by ITAT) without appreciating the available cash-in-hand as on 01.04.2010, the veracity of the cash book, and the 'Peak Theory' as accepted in Ved Prakash vs. CIT, making the finding perverse? (Section 69) 2. Whether the ITAT was justified in confirming an addition of ₹14,40,000 in the joint account with his grandfather, despite evidence suggesting the grandfather was the primary account holder and all transactions were done by him, leading to a perverse finding based on technical grounds and suspicion? (Section 69) 3. Whether the ITAT was justified in dismissing the appeal by ignoring the law laid down in Tek Ram (Dead) through LRs Versus Commissioner of Income Tax, Faridabad (357 ITR 133 SC) while rejecting additional evidence with substantive effect, rendering the ITAT's findings perverse? 4. Whether the ITAT's order is perverse, devoid of proper appreciation of facts, and against well-settled law? Assessee's Contentions: - The addition of ₹15,49,420 was unjustified as it did not consider opening cash balance, the cash book's veracity, and the 'Peak Theory'. - The addition of ₹14,40,000 in the joint account was based on technical grounds and suspicion, ignoring evidence that transactions were by the grandfather. - The ITAT wrongly rejected additional evidence, ignoring established legal precedents. - The ITAT's order was perverse and lacked proper appreciation of facts and law. Revenue's Contentions: - Not explicitly recorded in the provided text.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 69,Section 260-A

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. I.T.A. No. 453 of 2017 DATE OF DECISION : 16.03.2018 Parveen Kumar .... APPELLANT Versus Commissioner of Income Tax, Ludhiana ..... RESPONDENT

CORAM :- HON'BLE MR. JUSTICE S.J. VAZIFDAR, CHIEF JUSTICE HON'BLE MR. JUSTICE AVNEESH JHINGAN

Present: Mr. Sunil K. Mukhi, Advocate, for the appellant.

* * * AVNEESH JHINGAN, J. This is an appeal against the order of the Income Tax Appellate Tribunal partly allowing the appeal of the assessee.

2.

The matter pertains to the assessment year 2011-12. 3. According to the appellant, the following substantial questions of law arise in this appeal :- (i) Whether the ITAT is justified in confirming addition of ` 15,49,420/- without appreciating the cash-in-hand available as on 01.04.2010 to the extent of ` 10,94,260/- and without doubting the veracity of cash book even by the Departmental Representative after granting partial relief of ` 5 lakh without appreciating the `Peak Theory' duly accepted by this Hon'ble High Court in the case of 2018.03.16 11:08 I attest to the accuracy and authenticity of this document

ITA N

The order continues below.

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