C.I.T (CENTRAL) LUDHIANA vs. SMT.KARTAR KAUR TRUT LUDHIANA
What did the High Court hold?
The High Court held that the finding recorded by the Tribunal was primarily a finding of fact. The Court found that the revenue had not demonstrated that the reasons provided by the Tribunal were irrelevant or non-existent. Nothing was pointed out to enable the Court to conclude that the Tribunal's view was not a possible view given the facts of the case, and therefore, the finding could not be considered perverse. The Tribunal's decision to delete the addition of Rs. 80,000/- was upheld. The ratio decidendi is that an appellate Tribunal's factual findings, if supported by relevant and existing reasons and not perverse, are binding and cannot be interfered with by the High Court in a reference proceeding. The operative direction was to answer the question of law against the revenue and in favour of the assessee, disposing of the reference accordingly.
What were the facts?
The assessee, Shri Ashwani Kumar Garg, engaged in the purchase and sale of gold ornaments, reported receiving two gifts of Rs. 20,000/- each from Manohar Lal and Smt. Anju Rani, and a loan of Rs. 40,000/- from Smt. Anju Rani for the assessment year 1988-89. The Assessing Officer disbelieved the donors/creditors, finding Manohar Lal's gift capacity questionable due to his former bank clerk status and lack of relation, and Smt. Anju Rani's loan capacity insufficient given her stitching income and status as a housewife. The CIT(A) confirmed these additions. The Tribunal initially remanded the matter for providing donor statements, but upon further appeal, it held that Smt. Anju Rani was an income tax assessee with share income from M/s. P. Bansal Trading Company and had provided funds via cheques. The Tribunal also accepted Manohar Lal's statement, noting his salary income as a bank employee. The revenue is the petitioner and the assessee is the respondent.
What were the issues?
1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in deleting the entire addition of Rs. 80,000/-, which had been sustained by the DCIT(A), by accepting the creditworthiness of the donors/creditors and deeming the gift and loan transactions to be genuine? The revenue contended that the Tribunal was not justified in deleting the addition. The revenue argued that the initial disbelieving of the donors/creditors by the Assessing Officer and the confirmation by the CIT(A) should have been upheld. The revenue's argument was primarily based on the perceived lack of capacity and justification for the transactions by the donors/creditors. The judgment does not record specific arguments from the assessee's side, but it implies the assessee supported the Tribunal's findings. The revenue's counsel was heard by the High Court.
Which sections of the Income-tax Act were involved?
None explicitly mentioned in the provided text, other than the reference to the assessment year.
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
JUDGMENT: Following question of law has been referred for the opinion of this Court by the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar (for short, 'the Tribunal') arising out of its order dated 21.7.1997 in ITA Nos.281(ASR)/1995 and 64(ASR)/1997 in respect of assessment year 1988- 89:- “Whether on the facts and in the circumstances of the case, the Tribunal was justified in deleting whole of the addition of Rs.80,000/- sustained by the DCIT(A), Jalandhar treating the credit worthiness of the donor/creditors to denote/lend the amount to the assessee and transaction of gift and loan is genuine?” The assessee derives income from purchase and sale of gold ornaments. He claimed to have received two gifts of Rs.20,000/- each from Manohar Lal and Smt.Anju Rani, apart from a loan of Rs.40,000/- from Smt.Anju Rani. The assessee was asked to produce the donor and the loaner. The assessee produced them. The assessing Officer disbelieved the statement of Manohar Lal on the ground that he was earlier clerk in a Bank and had no source of income and it was beyond his capacity to make a gift
ITR No.38 of 1997 2 nor there was justification for him for doing so as he was not related to the assessee but claimed to be his friend. Statement of Smt.Anju Rani was also disbelieved. She claimed to be having income from stitching. It was held that huge amount of Rs.40,000/- could not be given by way of loan. She was a house wife. Source of gift and loan were disbelieved. On appeal, the CIT (A) confirmed the additions. On further appeal, the Tribunal restored the matter to DCIT(A) to decide the issue in respect of two gifts after supplying copies of statements of donors to the assessee. The DCIT(A) again decided the issues against the assessee. The Tribunal set aside the view taken by the DCIT(A) and held that Anju Rani, creditor and donor was income tax assessee; she also had share of income from M/s. P.Bansal Trading Company; she had given gift and loans through cheques. The Tribunal also believed the statement of Manohar Lal who was a bank employee and had Income from salary.
We have heard learned counsel for the revenue. The finding recorded by the Tribunal is primarily a finding of fact. It has not been shown that the reasons given by the Tribunal are, in any manner, irrelevant or non-existent. Nothing could be pointed out which could enable this Court to hold that the view taken by the Tribunal was not a possible view in the facts of the case. The finding cannot be held to be perverse. The question referred is, thus, answered against the revenue and in favour of the assessee. Reference is disposed of accordingly. (Adarsh Kumar Goel) Judge November 3, 2006 (Rajesh Bindal) 'gs' Judge
Recent GST High Court judgments
Search GST case law →- M/S.Sidhivinayak Roadways, Sundergarh vs. Commissioner Of GST And Central Excise, Rourkela Commissionerate, RourkelaOrissa · 15 Oct 2026
- Dillip Kumar Behera vs. The Assistant Commissioner Of State Tax, Mayurbhanj CircleOrissa · 15 Oct 2026
- M/S. Kalinga Paper Mart, Sundergarh vs. Commissioner Of CT And GST, CuttackOrissa · 15 Oct 2026
- Kabita Nayak vs. Chief Commissioner, CGST, Central Excise And Customs, KhurdaOrissa · 15 Oct 2026
- Swastika Ingot PVT.LTD, Sundargarh vs. The Addl Commissioner, GST And Central Excise, BhubaneswarOrissa · 15 Oct 2026
