SANJEEV KUMAR vs. COMMISSIONER OF INCOME TAX-1 AAYKAR BHAWAN SEC 17 CHD

This appeal has been preferred by the revenue under section 260A of the Income Tax Act, 1961 (in short, “the Act”) against the order dated 27.8.2015, Annexure A.3 passed by the Income Tax Appellate Tribunal, Chandigarh in ITA No.40/Chd/2013, for the assessment year 2009-10, claiming following substantial questions of law:- “i) Whether in the facts and in the circumstances of the case, the orders partly (Annexure A.1), partly (Annexure A.2) and partly (Annexure A.3) are legally sustainable? GURBAX SINGH 2016.05.10 11:23 integrity of this document High Court Chandigarh ii) Whether on the facts and in the circumstances of the case, the learned Income Tax Appellate Tribunal is right in law in upholding the order of the Assessing Officer and CIT(A) Chandigarh with regard to the addition of ` 25,00,000/- under section 68 of the Income Tax Act. The appellant filed requisite details with regard to the unsecured loan before the ITAT through a paper book for consideration during appellate proceedings but the same have not been taken into consideration while passing the order by the Hon'ble ITAT? iii) That the appellant assessee craves leave to alter, amend, delete or add to any of the above substantial questions of law during the pendency of the present appeal?”

A few facts relevant for the decision of the controversy involved as narrated in the appeal may be noticed. The appellant-assessee is engaged in the business of trading of steel at Morinda in Ropar district in the State of Punjab under the name and style of M/s Shree Neelkanth Enterprises, Kurali Road, Morinda, District Ropar. The appellant filed his return of Income on 30.9.2009 alongwith audit reports and audited annual accounts as per the provisions of section 44AB of the Act declaring net taxable income at ` 3,01,6320/-. The case of the appellant was processed under the provisions of section 143(1) of the Act on 7.9.2010 which was accepted. Subsequently, notice under section 143(2) of the Act was issued on 30.8.2010 as the case of the appellant was selected for scrutiny assessment. A questionnaire alongwith statutory notice was issued to the appellant on 23.6.2011, 3.8.2011 and 21.12.2011. The Assessing Officer in her order dated 29.12.2011, Annexure A.1 had specifically stated that since the assessee did not furnish any reply, there was no other alternative left with her but to complete the assessment on merits. It was further stated in the order that it was either Shri Sanjeev Garg, ITP or the brother of the GURBAX SINGH 2016.05.10 11:23 integrity of this document High Court Chandigarh appellant, Shri Bhushan Kumar who attended the proceedings before the Assessing Officer. The appellant never attended the proceedings as he was not well. No reply was filed by the assessee. While completing the assessment, the Assessing Officer made various additions and disallowances. According to the appellant, the additions made other than the addition of ` 25,00,000/- under Section 68 of the Act are not under challenge before this Court. Aggrieved by the order dated 29.12.2011, Annexure A.1 passed by the Assessing Officer, the assessee filed appeal before the Commissioner of Income tax (Appeals) [CIT(A)]. Vide order dated 29.10.2012, Annexure A.2, it was held that since the assessee had not been able to prove the source of cash credit of ` 25 lacs which was ostensibly received from Shri Ashok Bansal, the addition of the amount under section 68 of the Act was held to be justified. Not satisfied with the order, the assessee filed appeal before the Tribunal. The Tribunal vide order dated 27.8.2015, Annexure A.3 partly allowed the appeal. However, on the issue qua addition of the amount under section 68 of the Act, the findings recorded by the CIT(A) were upheld by the Tribunal. Hence the instant appeal by the assessee.