COMMISSIONER OF INCOME TAX, KOLKATA - XII vs. RADHE SHYAM GUPTA & SONS (HUF)

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ITA/138/2011HC CalcuttaWBCHCO002420201101 March 2023Bench: HON'BLE JUSTICE T. S. SIVAGNANAM,HON'BLE JUSTICE HIRANMAY BHATTACHARYYA2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court noted that the tax effect in the appeal was Rs. 83,25,148/-, which was below the threshold limit of Rs. 1 crore. Consequently, the Revenue was not permitted to pursue the appeal on this ground. The appeal was disposed of solely on the basis of low tax effect. The substantial question of law that had been admitted was expressly left open and not decided on merits. Therefore, no finding was reached by the High Court on the merits of the ITAT's order regarding the deletion of the addition.

What were the facts?

The Commissioner of Income Tax, Kolkata-XII (Revenue) filed an appeal under Section 260A of the Income Tax Act, 1961, against an order dated 18.2.2010 passed by the Income Tax Appellate Tribunal (ITAT), Kolkata. The appeal pertains to Assessment Year 2003-2004 and challenges the ITAT's deletion of an addition of Rs. 1,88,40,707/- made by the Assessing Officer and confirmed by the Commissioner of Income-tax (Appeals). The addition related to an amount shown by the assessee, Radhe Shyam Gupta & Sons (HUF), as liability towards outstanding payments to 'Karigars' under the head 'Karigar Purja se Account'. The assessee was unable to provide the identity of these Karigars.

What were the issues?

1. Whether the learned Tribunal below committed substantial error of law in deleting the addition made by the Assessing Officer and confirmed by the Commissioner of Income-tax (Appeals) amounting to Rs. 1,88,40,707/- under the head “Karigar Purja se Account” shown by the assessee as the liability towards outstanding payment to the Karigars when the assessee could not give identity of those Karigars? (Question of law/mixed law and fact, concerning Section 68 of the Income Tax Act, 1961). Assessee's contentions: Not recorded in the judgment. Revenue's contentions: The Revenue argued that the ITAT erred in deleting the addition of Rs. 1,88,40,707/-. The addition was made because the assessee failed to identify the 'Karigars' to whom outstanding payments were allegedly due, thereby treating the sum as unexplained income. The Revenue contended that the deletion by the ITAT constituted a substantial error of law.

Which sections of the Income-tax Act were involved?

Section 260A,Section 68

AI-generated summary — verify with the full judgment below

OD–2 IN THE HIGH COURT AT CALCUTTA SPECIAL JURISDICTION (INCOME TAX) ORIGINAL SIDE ITA/138/2011 IA NO. GA/2/2011 (Old No.GA/1359/2011) THE COMMISSIONER OF INCOME TAX KOLKATA- XII, KOLKATA VS. RADHE SHYAM GUPTA & SONS (H U F) BEFORE : THE HON’BLE JUSTICE T.S. SIVAGNANAM And THE HON’BLE JUSTICE HIRANMAY BHATTACHARYYA Date : 1st March, 2023 Appearance : Mr. Soumen Bhattacharjee, Adv. …for appellant The Court : - This appeal has been filed by the revenue under Section 260A of the Income Tax Act, 1961 (the Act) is directed against the order dated 18.2.2010 passed by the Income Tax Appellate Tribunal “B” Bench, Kolkata in I.T.A. No. 1169/Kol/2007 relating to the Assessment Year 2003-2004. The appeal was admitted on 13.6.2011 on the following substantial question of law :- i) Whether the learned Tribunal below committed substantial error of law in deleting the addition made by the Assessing Officer and confirmed by the commissioner of Income-tax (Appeals) amounting to Rs.1,88,40,707/- under the head “Karigar Purja se Account” shown by the assessee as the liability towards outstanding payment to the Karigars when the assessee could not give identity of those Karigars? We have heard Mr. Soumen Bhattacharjee, learned standing Counsel for the appellant.

2 As rightly pointed out by the learned standing Counsel the tax-effect in this appeal is less than the threshold limit of Rs. 1 crore as it is Rs.83,25,148/-. Therefore, the revenue cannot pursue this appeal. Accordingly, the appeal stands disposed of on the ground of low tax effect. The substantial question of law, which has been admitted, is left open. Consequently, GA/2/2011 stands closed. (T.S. SIVAGNANAM, J.)

(HIRANMAY BHATTACHARYYA, J.) Pkd/GH.

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