GURUNANAK KHANDSARI UDYOG vs. INCOME TAX OFFICER

ITA/1/2004HC UttarakhandUKHC01004841200427 March 2006Author: HON'BLE MR. JUSTICE P. C. VERMA2 pages

AI SummaryDismissed

What did the High Court hold?

The High Court held that it found no infirmity or illegality in the order passed by the Income Tax Appellate Tribunal. The Court stated that the findings recorded by the Tribunal were findings of fact and did not warrant interference by the High Court. Consequently, the appeal filed by the assessee was dismissed. The ratio decidendi is that High Courts generally do not interfere with the factual findings of the ITAT unless there is a substantial question of law. No specific issue was left undecided; the appeal was decided on its merits.

What were the facts?

The assessee, Gurunanak Khandsari Udyog, a partnership firm, maintained regular books of accounts. For Assessment Year 1996-97, the Assessing Officer (AO) enhanced the value of closing stock by Rs. 4,50,501.00, disagreeing with the assessee's explanation and the valuation done by Laxmi Chand and Sons. The assessee appealed to the Commissioner of Income Tax (Appeals) [CIT(A)], who deleted the additions, considering the location of Laxmi Chand & Co. on the main road versus the assessee's crusher in an interior area. The Revenue appealed to the Income Tax Appellate Tribunal (ITAT). The ITAT, by order dated 23.07.2003, set aside the CIT(A)'s order and confirmed the AO's assessment. The assessee then filed an appeal before the High Court.

What were the issues?

1. Whether the High Court should interfere with the findings of fact recorded by the Income Tax Appellate Tribunal. (Question of law) Assessee's Contention: The assessee did not explicitly argue any specific points in the provided text before the High Court. The appeal was filed against the ITAT's order. Revenue's Contention: The revenue did not explicitly argue any specific points in the provided text before the High Court. The appeal was filed against the ITAT's order.

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF UTTARANCHAL AT NAINITAL

INCOME TAX APPEAL NO.01 OF 2004

Gurunanak Khandsari Udyog, Ahmed Pur Grant, Roorkee .......... Appellant

Versus

Income Tax Officer, Income Tax Officer, Roorkee ........ Respondent

Dated: March 27, 2006

Sri P.C. Mullick, Id. Counsel for the appellant Sri P. Maulekhi, learned standing counsel for the respondent

Coram: Hon’ble P.C. Verma, J. Hon’ble B.C. Kandpal, J.

This is an appeal against the judgment and order dated 23.07.2003 passed by Income Tax Appellate Tribunal ‘SMC-II’, New Delhi in ITAT No.787/Del/2000. The matter in dispute relates to Assessment Year 1996-97.

Brief facts of the case giving rise to the present appeal are that appellant is a partnership firm with manufacturing works at Village Ahmedpur, Roorkee. The regular books of accounts namely cash book, ledger, purchase register with parchies issued to kashtkars, manufacturing accounts as prescribed under Khandsari Act etc. are regularly maintained and checked by Khandsari Department from time to time. The Income Tax Officer had also checked the books of accounts including registers maintained in the light of valuation of closing stock done by Laxmi Chand and Sons very minutely and after not being convinced with the explanation of the assessee, he enhanced the value of closing stock by Rs.450501.00 vide

his Assessment Order dated 31.12.1998. Aggrieved by the said order, the appellant filed an appeal before Commissioner of Income Tax (Appeals), Muzaffarnagar who vide his order dated 02.11.1999 deleted the additions on sugarcane, Gur, molasses and Rab after taking into account one major factor that Laxmi Chand & Co. was situated on the main road to Saharanpur where the assessee’s crusher was somewhere in the interior area and accordingly allowed the appeal of the assessee. Being aggrieved by the said order, the Revenue preferred an appeal before Income Tax Appellate Tribunal. The Tribunal Vide his order dated 23.07.2003 after taking the material available on record set aside the order of Commissioner of Income Tax (Appeals) and confirmed the order of Assessment Officer. Feeling aggrieved, the appellant has come up in the appeal.

We have heard learned counsel for the parties and perused the impugned judgment. We do not find any infirmity or illegality in the order impugned passed by the Income Tax Appellate Tribunal. The findigns recorded by the Tribunal are the findings of fact and do not call for any interference by this Court.

The appeal is dismissed accordingly. No order as to costs.

(B.C. Kandpal, J.) (P.C. Verma, J.)

Rajeev Dang

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