Uttarakhand High Court Judgments — 2018

The High Court held that it is not bound to adjudicate an appeal preferred against an interlocutory order passed by the ITAT, even if the appeal was admitted, when the main appeal has since been disposed of by the ITAT. The Court reasoned that it would not ordinarily decide questions of law which have become academic due to subsequent events. In this case, the appeal was against an interim order concerning a stay, and since the main appeal was disposed of, the interim order would not survive. Therefore, the cause in the present appeal, which arose from an interlocutory order, no longer survived. The High Court dismissed the appeal as infructuous, leaving the question of law open for consideration in an appropriate case. The operative direction was to dismiss the appeal.

The High Court held that no substantial question of law arose from the ITAT's order. The Court noted that the Commissioner of Income Tax (Appeals) had found no evidence of unvouched, inflated, or bogus expenses, nor any indication that the expenditure was for non-business purposes. The CIT(A) reasoned that suspicion alone cannot form the basis for a sustainable addition. The ITAT had also relied on case law to uphold the CIT(A)'s order. Therefore, the High Court found no merit in the revenue's appeal and dismissed it. The operative direction was the dismissal of the appeal.