VISHAL TOOLS & FORGINGS PVT. LTD. vs. CIT, JALANDHAR

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ITA/134/2011HC Punjab & HaryanaPHHC01095448201127 May 2011Author: MR. JUSTICE ADARSH KUMAR GOEL,MR. JUSTICE RAJESH BINDAL2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the appeal was covered by its previous decisions. Specifically, question (i) regarding the mandatory levy of interest under Section 234B was decided against the assessee in Vishal Tools & Forgings Private Limited vs Commissioner of Income Tax, Jalandhar (Punjab) on 20.5.2011. Questions (ii) and (iii), concerning the charging of income from undisclosed sources and its eligibility for deduction under Section 80IB, were also decided against the assessee in Home Tax vs Commissioner of Income Tax, Karnal on 24.5.2011. In light of these precedents, the High Court found no merit in the assessee's appeal. The operative direction was to dismiss the appeal.

What were the facts?

The assessee, Vishal Tools & Forgings Private Limited, filed an appeal under Section 260A of the Income Tax Act, 1961, against the order of the Income Tax Appellate Tribunal, Amritsar Bench, for the assessment year 2005-06. The appeal challenged the Tribunal's decision regarding the levy of interest under Section 234B, the charging of income from undisclosed sources under Chapter VI without discharging departmental onus, and whether additions made to income from undisclosed sources could be considered business income eligible for deduction under Section 80IB. The High Court heard the learned counsel for the appellant.

What were the issues?

The High Court was asked to decide the following substantial questions of law: 1. Whether, on a true and correct interpretation of Section 234B, the levy of interest is mandatory even where there is a conflict of decisions and the admitted liability has been paid? 2. Whether, on a true and correct interpretation of Section 145, the findings are sustainable for charging income from undisclosed sources under Chapter VI without the department discharging its onus to prove the source of such other income? 3. Whether the Tribunal's order is sustainable for additions made to the assessee's income as income from other undisclosed sources, which could be considered as business income eligible for deduction under Section 80IB of the Income Tax Act, 1961? The assessee's counsel conceded that question (i) was covered against the assessee by a previous order of the High Court in ITA No. 121 of 2011. The counsel also stated that questions (ii) and (iii) were covered against the assessee by another order of the High Court in ITA No. 125 of 2011. The revenue did not present any arguments.

Which sections of the Income-tax Act were involved?

Section 260A,Section 234B,Section 145,Section 80IB

AI-generated summary — verify with the full judgment below

(1) IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 134 of 2011 (O&M) Date of decision: 27.5.2011 Vishal Tools & Forgings Private Limited ....Appellant vs Commissioner of Income Tax, Jalandhar (Punjab) ...Respondent Coram: Hon'ble Mr. Justice Adarsh Kumar Goel Acting Chief Justice Hon'ble Mr. Justice Rajesh Bindal Present: Mr. Pankaj Jain, Advocate for the appellant. Rajesh Bindal, J. This appeal has been filed by the assessee under Section 260A of the Income Tax Act, 1961 (in short “the Act”), for the assessment year 2005-06, against the order of the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar (hereinafter referred to as “the Tribunal”) in ITA No. 158/ASR/2009 dated 9.10.2009, raising the following substantial questions of law:- “(i) Whether on the true and correct interpretation of section 234B the levy of interest is mandatory where there is a conflict of decision and the admitted that liability stands paid? (ii) Whether on the true and correct interpretation of the provisions of section 145 the finding are sustainable for charging the income from undisclosed sources under Chapter VI without discharging the departmental onus to prove the source of such other income? (iii) Whether the Tribunal order is sustainable, for the additions made to the income of the assessee as income from other undisclosed sources, can be considered as income from the business, which is eligible for deduction u/s 80IB of the IT Act 1961?”

(2)

We have heard learned counsel for the appellant on merits. Learned counsel for the assessee fairly states that question no. (i) is covered against the assessee by order dated 20.5.2011 passed by this court in ITA No. 121 of 2011 Vishal Tools & Forgings Private Limited vs Judge

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