SATISH KUMAR vs. COMMISSIONER OF INCOME TAX

ITA/433/2014HC Punjab & HaryanaPHHC01109589201429 July 2015Author: MR. JUSTICE M.M. AGGARWAL,MR. JUSTICE A.B. CHAUDHARI2 pages
AI SummaryDismissed

What were the facts?

The appeal concerns assessment year 2008-2009. During a survey under Section 133-A of the Income Tax Act, 1961, the Assessing Officer (AO) found excess cash (`2,97,271), excess stock (`10,65,788), investment in unaccounted purchases with profit (`18,46,000), and miscellaneous income for other discrepancies (`2,90,941), totaling `35,00,000. The assessee initially admitted these as separate items. However, when filing the return, the assessee declared only `20,00,000, claiming the undisclosed income from excess stock and unrecorded purchases pertained to the same transactions. The AO rejected this, and the Commissioner of Income Tax (Appeals) and the Income Tax Appellate Tribunal upheld the AO's addition of `35,00,000.

What did the High Court hold?

The High Court held that the question of whether the two amounts (excess stock and unrecorded purchases) ought to be telescoped into one is a matter that can only be answered upon appreciation of evidence. Since this requires an examination of facts and evidence, no substantial question of law arises for consideration by the High Court. Consequently, the High Court found no error in the Tribunal's decision to dismiss the appeal. The operative direction was the dismissal of the appeal, upholding the addition made by the AO and confirmed by the lower appellate authorities.

What were the issues?

1. Whether the Tribunal erred in holding that no substantial question of law arises from the concurrent findings of the lower authorities regarding the telescoping of different heads of undisclosed income into one, which requires appreciation of evidence. Assessee's Contention: The assessee argued that the discrepancies regarding unrecorded purchases and excess stock pertained to the same transactions, and therefore, the amounts should be telescoped into one. The assessee's return of `20,00,000 was based on this premise. Revenue's Contention: The revenue contended that the assessee had voluntarily accepted the discrepancies as separate during the survey and made separate declarations. The subsequent attempt to telescope these amounts at the time of filing the return was an attempt to reduce the declared income and was rightly rejected by the AO.

Which sections of the Income-tax Act were involved?

Section 133-A

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

ITA-433-2014 (O&M) Date of decision:- 29.07.2015

Satish Kumar ...Appellant Versus Commissioner of Income Tax, Panchkula ...Respondent

CORAM: HON'BLE MR. JUSTICE S.J. VAZIFDAR, ACTING CHIEF JUSTICE

HON’BLE MR. JUSTICE G.S. SANDHAWALIA

Present: Mr. Ravi Shankar, Advocate,

for the appellant.

Mr. Yogesh Putney, Advocate,

for the respondent. * * * * S.J. VAZIFDAR, A.C.J. (ORAL) This is an appeal against the order of the Income Tax Appellate Tribunal dated 09.06.2014 dismissing the appeal against the order of the CIT (Appeals) which upheld the addition made by the Assessing Officer of a sum of ` 35 lacs to the income of the appellant/assessee. The matter pertains to the assessment year 2008-2009. 2. During the course of survey proceedings under Section 133-A of the Income Tax Act, 1961, excess cash, excess stock, investment in unaccounted purchases and discrepancies in the books were found. The quantum in respect of each of these items is as follows:- (i) Excess cash ` 2,97,271/- (ii) Excess stock ` 10,65,788/- (iii) Investment in unaccounted purcha

The order continues below.

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