Commissioner of Income Tax vs K.S. Bhatia

Jawahar Lal Gupta, J.—The dispute relates to the assessment year 1986-87. The assessee filed a return declaring the income of Rs. 31,430. The assessment was completed by the Assessing Officer vide order dated January 30, 1990. The taxable income was fixed at Rs. 4,86,550. This addition had been made on the basis of some record relating to the assessment under the Sales Tax Act. The assessee filed an appeal. The Commissioner of Income Tax (Appeals), Faridabad, vide order dated November 9, 1990 found that the assessee was entitled to the deletion of an amount of Rs. 57,595.

Aggrieved by the order of the appellate authority, the Revenue and the assessee filed appeals. The claim of the assessee was accepted. A sum of Rs. 80,797 was ordered to be deleted. The appeal filed by the Revenue was dismissed. The Revenue filed a petition u/s 256(1) of the Income Tax Act, 1961. It was dismissed. Hence, this petition u/s 256(2) of the said Act.

The Revenue maintains that the following two questions of law arise for the opinion of this court :

(i) Whether, on the facts and in the circumstances of the case, the decision of the Income Tax Appellate Tribunal was perverse in law in deleting the trading addition of Rs. 80,757 confirmed by the Commissioner of Income Tax (Appeals) by ignoring the evidence contained in the seized books of account and by relying on entries in journal which remained in the custody of the assessee when the entries in the journal were not reflected in the seized books of account and were also unsupported by any independent evidence like freight cartage or sale bills ?

(ii) Whether, on the facts and in the circumstances of the case, the decision of the Income Tax Appellate Tribunal was perverse in law in dismissing the appeal of the Revenue and confirming the order of the Commissioner of Income Tax (Appeals), who, granted relief of Rs. 57,595 by ignoring the evidence contained in the seized books of account and by relying on entries in journal which remained in the custody of the assessee when the entries in the journal were not reflected in the seized books of account and were also unsupported by any independent evidence like freight, cartage or sale bills ?"

We have heard Mr. R.P. Sawhney, learned counsel for the Revenue.

It is not disputed that the relevant additions were made on the basis of the order of assessment passed by the assessing authority under the Sales Tax Act. It is still further the admitted position that the appeal filed by the assessee against the order of the Assessing Officer before the Joint Excise and Taxation Commissioner was accepted. The order, which was the basis for additions, was set aside. It is on this basis that the Tribunal has found that the additions of Rs. 57,595 and Rs. 80,757 were not sustainable.

We find no infirmity in the view taken by the Tribunal. A finding of fact has been recorded on the basis of the evidence on the file. No question of law, as posed by the Revenue, arises.

Still further, it deserves notice that the assessee had claimed to have transferred certain stocks to a sister concern. This concern was owned by Smt. Shakuntala Bhatia. Her claim was also accepted by the Tribunal. The Revenue has accepted the order of the Tribunal as it has not even filed a petition u/s 256(1) of the Income Tax Act, 1961, in that case.

In view of the above, we find no ground to direct the Tribunal to make any reference to this court.

The petition is dismissed in limine.