COMMR. OF INCOME TAX, ROHTAK vs. M/S DABUR BRICKS CO.

ITA/107/2005HC Punjab & HaryanaPHHC01068931200508 December 2011Author: MR. JUSTICE HEMANT GUPTA,MR. JUSTICE GURMEET SINGH SANDHAWALIA5 pages
AI SummaryRemanded

What were the facts?

The Revenue (Commissioner of Income Tax, Rohtak) has filed appeals against an order of the Income Tax Appellate Tribunal (ITAT) dated 05.08.2004. The ITAT's order pertained to assessment years 1995-96 and 1997-98. A survey under Section 133A was conducted on the assessee, M/s Dabur Bricks Company, on 11.08.1998, leading to the issuance of a notice under Section 148. The assessee initially declared a loss. During assessment proceedings under Section 144, the assessee failed to produce books of account or vouchers. The Assessing Officer estimated profit at Rs. 3,20,000/-. The CIT(A) reduced this by applying a net profit rate of 6.57%, despite noting that no documents were produced. The ITAT, however, held that books of account were produced before the CIT(A) and not considered, accepting the assessee's appeal.

What did the High Court hold?

The High Court found that a perusal of the CIT(A)'s order did not indicate that account books were produced before him. Therefore, the Tribunal could not have concluded that the books of account were not considered by the CIT(A) as nothing was produced before him. Such a finding by the Tribunal was considered perverse and unsustainable. Consequently, substantial questions of law No. 1 and 2 were answered in favour of the revenue and against the assessee. The Court held that other questions of law did not arise for consideration in light of this finding. As a consequence, the matter was remitted back to the Tribunal to decide the appeal afresh on merits according to law.

What were the issues?

The Tribunal had to decide the following substantial questions of law: 1. Whether the ITAT's order is perverse as it is based upon an incorrect assumption of fact (Section 260-A). 2. Whether the ITAT erred in law by holding that the CIT(A) did not consider the books of account, when no such books/vouchers were produced before the CIT(A) (Section 260-A). 3. Whether the ITAT erred in law by holding that Sh. Jagjit Singh was not well conversant with the consumption of coal over purchase and sale of bricks (Section 260-A). 4. Whether the ITAT erred in law in holding that the manufacturing and trading results shown by the assessee in its books of account were not suffering from any infirmity (Section 260-A). Assessee's Contentions: - Complete account books were produced before the CIT(A) but could not be produced before the Assessing Officer. Revenue's Contentions: - The ITAT's finding that books of account were produced before the CIT(A) is perverse and based on incorrect facts. - The CIT(A) himself recorded that books of account were not produced before him, yet applied a reduced net profit rate.

Which sections of the Income-tax Act were involved?

Section 260-A,Section 133A,Section 148,Section 144,Section 131,Section 250(4)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of decision: 08.12.2011 (i) ITA No. 107 of 2005 Commissioner of Income Tax, Rohtak …..Appellant vs. M/s Dabur Bricks Company …..Respondent (ii) ITA No. 113 of 2005 Commissioner of Income Tax, Rohtak …..Appellant vs. M/s Dabur Bricks Company …..Respondent (iii) ITA No. 114 of 2005 Commissioner of Income Tax, Rohtak …..Appellant vs. M/s Dabur Bricks Company …..Respondent CORAM: - HON’BLE MR. JUSTICE HEMANT GUPTA HON’BLE MR. JUSTICE G.S.SANDHAWALIA Present: - Mr. Inderpreet Singh, Advocate for the appellant. Mr. Sandeep Chabra, Advocate for respondent. HEMANT GUPTA, J

ITA Nos. 107, 113 and 114 of 2005 This order shall dispose of the above mentioned Income Tax Appeals filed under Section 260-A of the Income Tax Act, 1961 (for short the ‘Act’) arising out the order dated 5.8.2004 passed by the Income Tax Appellate Tribunal, Delhi Bench, Delhi in Income Tax Appeal No. 1570/Del/2004 & Income Tax Appeal No. 1271/DEL/2004 pertaining to assessment year 1995-96 and ITA No. 1571/DEL/2004 pertaining to assessment year 1997-98. The revenue has claimed the following substantial questions of law: - i) On the facts and in the circumst

The order continues below.

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