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SHRI MAHAVIR PRASAD AGGARWAL v. COMMISSIONER OF INCOME TAX, ROHTAK - ITA-11-2006  RD-P&H 3986 (11 July 2006)
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
I.T.A. NO. 11 OF 2006
DATE OF DECISION: 07.07.2006
SHRI MAHAVIR PRASAD AGGARWAL
COMMISSIONER OF INCOME TAX, ROHTAK
CORAM: HON'BLE MR. JUSTICE ADARSH KUMAR GOEL
HON'BLE MR. JUSTICE RAJESH BINDAL
PRESENT: MR. P.C. JAIN, ADVOCATE FOR THE APPELLANT JUDGMENT
This is an appeal filed by the assessee raising following substantial questions of law, arising out of order passed by the Income-Tax Appellate Tribunal, New Delhi, Bench 'A', (for short 'the Tribunal') in ITA No. 82/DEL/2005 dated 6.5.2005, for the assessment year 2001-2002: "i. Whether under the facts and circumstances of the case the Tribunal is not justified in concurring with the finding of the Commissioner of Income Tax (Appeals) and upholding the addition of
Rs. 8,57,031/- as income from undisclosed source which finding is completely perverse and without appreciating the necessary evidence ?
ii. Whether under the facts and circumstances of the case the Tribunal is not justified in not giving the finding whether the Commissioner of Income Tax (Appeals) is justified in exceeding its jurisdiction by giving the direction for the A.Y. 2000-01 to issue the notice u/s 148 whereas the appeal is pending relates to the A.Y. 2001-02.
iii. Whether under the facts and circumstances of the case the Tribunal was justified in upholding the action of the Commissioner of Income Tax (Appeals) wherein the disallowance on account of professional expenses and less household I.T.A. NO. 11 OF 2006 
expenses on estimated basis. Addition made by the Assessing Officer was foundationally changed as to enhancement of professional receipts without any basis and without application of mind and hence the order is perverse."
Briefly stated the facts of the case are that the assessee, who is an advocate of long standing at Civil Court, Hisar, filed his return declaring his income at Rs. 3,45,280/- on 16.10.2001, which was processed under Section 143(1) of the Income Tax Act, 1961 (for short `the Act') on 6.5.2002. Later on, the case was selected for scrutiny and accordingly, statutory notice under Section 143 (2) of the Act and the questionnaire were issued. During the course of assessment, it was found that the assessee had made substantial investment in shares whereas on account of professional income receipt was shown only at Rs. 1,55,900/-, and after claiming expenses of Rs. 1,53,870/-, the net income of Rs. 2030/- only was declared.
The expenses, so claimed, were not even supported by voucher, receipt etc.
During the course of assessment the Assessing Officer estimated the professional income of Rs. one lac per month, as against Rs.
150/- per month shown by the assessee. Coupled with this while examining investment in shares and also keeping in view the fact that there was no supporting evidence on record as regards the source of investment in purchase of shares by the assessee, an addition of Rs. 8,57,031/- was worked out as unexplained investment. Addition to this extent was made while framing assessment. While doing so the Assessing Officer categorically recorded in the order of assessment that during the course of hearing on 17-3-2004, the matter in this regard was discussed in detail and after discussion, the counsel for the assessee admitted that they are not able to prove from the books of account or other records that what has been certified in the certificate given by M/s Ajay & company, Hisar, is correct. It was also admitted by him that they are not able to furnish even the copy of account of the assessee from the books of account of M/s Ajay & Company or any other supporting evidence to show that investment in the purchase of shares was made from/through the books of account of M/s Ajay & Co. It is significant to note that firm M/ Ajay & Co. is owned by the son of the I.T.A. NO. 11 OF 2006 
In view of the above, no significance could be attached to the certificate from M/s Ajay & Company. In other words, it may be mentioned that the evidence with regard to the source of investment in purchase of shares by the assessee can't be considered to be sufficient/ satisfactory unless it was proved from the books of account or any other supporting evidence to show that the funds flowed from a particular source and then invested in the purchase of shares by the assessee. When even the copy of account of the assessee from the books of account of M/s Ajay & Co. was not forthcoming in spite of the latter being a family concern of the assessee, then the sanctity of the certificate as a piece of evidence could not be accepted.
Had the assessee made investment in the impugned transactions of sale and purchase of shares during the year through M/s Ajay & Co., Hisar, then there was no reason as to why the said firm should not be able to furnish the copy of account of the assessee so as to show that investment in the purchase of particular shares was made from the specific regular sources. It is also recorded in the order of assessment that as per para 9(b) of the Audit Report in form No. 3CD in the case of M/s Ajay & Co, Hisar, it is reported to have been maintaining the books of account on computer.
Still what prevented the assessee from furnishing the source of investment in the purchase of shares is best known to him. It needs to be pointed out here that jurisdiction over the case of M/s Ajay & Company, Hisar, vests with this office and assessment proceedings U/s 143 (3) for the Assessment Year 2001-02 continued in the case of that assessee also. In spite of repeated opportunities allowed to the said concern, no books of account were produced by it even in its own case.
It is further relevant to add here that since an addition of Rs. 8,57,031/- was made on account of unexplained investment in the purchase of shares during the year in question, no separate addition on account of undisclosed income from the profession was made. Ultimately, the income of the assessee was assessed at Rs. 12,77,310/- as against Rs. 3,45,280/- declared by the assessee.
The findings of the Assessing Officer regarding addition of I.T.A. NO. 11 OF 2006 
Rs. 8,57,031/- on account of undisclosed investment in the shares was upheld by the Commissioner of Income Tax (Appeals) (for short `CIT(A)') besides upholding some other additions as well.
The addition on account of undisclosed investment in the shares was further upheld by the Tribunal, with the following findings: "We have considered the matter carefully. The mere fact that there was sufficient opening balance as on 1.4.2000 and sufficient closing balance as on 31.3.2001 does not by itself establish that the share transactions made by assessee have been routed through accounts of Ajay & Co. Whether the transactions have been routed through accounts of Ajay & Co., can be established only by the copy of accounts with Ajay & Co. and the entries made therein and duly certified by the proprietor of the company. But no such detail or any such copy of accounts or any other detail or evidence has been furnished to establish that the share transactions have been routed through the accounts of Ajay & Co.. In view of this position, we do not find any infirmity in the order of Ld. CIT (A) and the same is, therefore, upheld and the addition is confirmed" Finally on the issue of addition of Rs. 8,57,031/- on account of undisclosed investment in shares, there is concurrent finding of fact by all the authorities below.
Though there was nothing on record to prove the genuineness of the transactions and the source thereof, counsel for the assessee has argued about perversity of the findings on account of addition of Rs. 8,57,031/- by submitting that there was running account of the assessee with the firm M/s Ajay & Company owned by the son of the assessee and the investment so made was duly explained and was self evident on a perusal of the statement.
We have perused the orders passed by the Tribunal as well as the authorities below and find that it was concurrently held by all the authorities that the assessee at the relevant time had not been able to I.T.A. NO. 11 OF 2006 
produce any evidence to support his claim even though the firm namely M/s Ajay & Company, through which alleged transactions had been made, is owned by his son. In the absence thereof there was valid reason for rejecting the claim of the assessee. In the absence of any evidence on record to satisfy the authorities below to substantiate his claim, the plea of perversity of the findings cannot be sustained before this Court. The assessee has not been able to refer to any evidence which is on record with the authorities, which has either been ignored or misread by the authorities. In the absence thereof, the plea of perversity in the findings is totally misconceived.
No other point has been argued.
The appeal is, accordingly, dismissed in limine having no substantial question of law.
July 7, 2006 (ADARSH KUMAR GOEL)
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