C.I.T.UDAIPUR vs. SANTOSH KUMAR KHODNIA

ITA/90/2011HC RajasthanRJHC01030518201013 May 2011Author: ABHAY MANOHAR SAPRE,NISHA GUPTA4 pages
AI SummaryDismissed

What were the facts?

This appeal under Section 260-A of the Income Tax Act was filed by the assessee, Mohd. Yusuf, against an order dated 09.10.2009 passed by the Income Tax Appellate Tribunal (ITAT), Jodhpur. The ITAT's order pertained to Assessment Years 1990-91 to 2000-01. The ITAT had dismissed the assessee's appeal, thereby upholding additions made to the assessee's total income by the Assessing Officer (AO) and consequently affirming the order of the CIT (Appeal). The additions were made by the AO under Section 68 of the Income Tax Act, treating certain amounts as income from unexplained sources after not accepting the assessee's explanation. The CIT (Appeal) had also upheld these additions. The High Court was considering whether the appeal involved a substantial question of law.

What did the High Court hold?

The High Court dismissed the appeal in limine, holding that it did not involve any substantial question of law as required by Section 260-A of the Income Tax Act. The Court reasoned that the issue primarily involved a pure question of fact, specifically the acceptance or rejection of the assessee's explanation for the source of income. The Court stated that it could not undertake a fresh examination of factual issues or draw factual inferences in its appellate jurisdiction under Section 260-A. The Tribunal had examined the assessee's explanation in detail and recorded a finding for its non-acceptance, which was binding on the High Court. The Court clarified that a factual finding would only constitute a substantial question of law if it were entirely dehors the subject, based on no reasoning, absurd reasoning, or against a provision of law. The submission regarding loose papers was also found to be without merit, as they were considered for examining the source of income, leading to a factual finding. Therefore, the additions made by the AO, upheld by the CIT (Appeal) and the Tribunal, were sustained due to the lack of a substantial question of law.

What were the issues?

1. Whether the Tribunal erred in not accepting the explanation offered by the assessee regarding the source of income, which the assessee contended was plausible and satisfactory, leading to the deletion of additions made by the Assessing Officer? (Question of mixed law and fact, concerning Section 68 of the Income Tax Act). Assessee's Contentions: - The Tribunal erred in not accepting the assessee's explanation regarding the source of income. - The assessee had offered a plausible and good explanation that should have been accepted by the AO. - The factual scenario supported the explanation as satisfactory for deleting the AO's additions. - Loose papers cannot be treated as books of accounts. Revenue's Contentions: - The judgment records no specific contentions for the revenue, other than their implicit stance of upholding the AO's and CIT(A)'s orders.

Which sections of the Income-tax Act were involved?

Section 260-A,Section 68

AI-generated summary — verify with the full judgment below

1 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR J U D G M E N T INCOME TAX APPEAL NO.90/2010 : 24.11.2010 HON'BLE MR. JUSTICE A.M. SAPRE HON'BLE MR. JUSTICE C.M. TOTLA Mr. Sunil Bhandari, for the appellant. BY THE COURT : (PER HON'BLE SAPRE,J.)

1.

This is an appeal filed by the assessee under Section 260-A of the Income Tax Act against an order dated 09.10.2009 passed by I.T.A.T., Jodhpur (for short called Tribunal) in IT(SS)A No.11/JU/2004 for the period AY 1990- 91 to 2000-01. 2. By the impugned order, the Tribunal upheld the additions made by A.O. by dismissing the appeal filed by assessee and in consequence upheld the order of CIT (Appeal).

3.

So the question that arises for consideration in this appeal is whether it involves any substantial question of law within the meaning of Section 260-A ibid?

4.

Having heard the learned counsel for the appellant and on perusal of record of the case, we are inclined to dismiss the appeal in limine as in our opinion the appeal does not involve any substantial question of law as is required to be made out within the meaning of Section 260-A ib

The order continues below.

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