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TAXAP/403/2010 3/ 3 ORDER
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
TAX
APPEAL No. 403 of 2010
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COMMISSIONER
OF INCOME TAX-V - Appellant(s)
Versus
CHITRA
PUBLICITY CO - Opponent(s)
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Appearance
:
MRS
MAUNA M BHATT for Appellant(s) : 1,
MR SN SOPARKAR, SR. ADV. with
MRS SWATI SOPARKAR with Ms. BHOOMI M THAKORE with MR MONAAL
DAVAWALA for Opponent(s) :
1,
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CORAM
:
HONOURABLE
MR.JUSTICE AKIL KURESHI
and
HONOURABLE
MS JUSTICE SONIA GOKANI
Date
: 30/08/2011
ORAL
ORDER
(Per
: HONOURABLE MR.JUSTICE AKIL KURESHI)
1. Revenue
has preferred this appeal challenging the judgment of the Tribunal
dated 17.7.2009 raising following questions for our consideration:-
“[A] Whether the
Appellate Tribunal is right in law and on facts in confirming the
order passed by CIT(A) in directing to delete the addition of
Rs.15,33,088/- made on account of bogus purchase from M/s. D.R. Steel
Corporation ?
[B] Whether the Appellate
Tribunal is right in law and on facts in confirming the order passed
by CIT(A) in directing to delete the addition of Rs.26,28,720/- and
Rs.41,16,318/- made on account of bogus purchases from M/s. Amit
Enterprises and M/s. Om Steel Traders?”
2. The
issue pertains to block assessment. The Revenue had carried out
search and seizure operations in the business and residential
premises of the respondent assessee on 13.12.2000. Subsequently, in
response to the notice under Section 158 BC of the Act, the assessee
had filed the return for the block period under consideration on
26.5.2003. The Assessing Officer finalized return on 31.12.2003
determining the total undisclosed income of Rs.1,45,00,000/-. The
three amounts of Rs15,33,000/-,26,28,000/- and 41,61,000/- referred
to in the questions framed by the Revenue were part of such
additions.
3. It
is the case of the assessee that such additions are not based on
material found during the search operations and, that, therefore, any
subsequent inquiry carried out by the Assessing Officer would not
permit him to bring such additions within the fold of the block
assessment proceedings.
4. This
is the central issue which is presented for our consideration.
5. The
Tribunal, in the impugned judgment, while upholding the view of
CIT(Appeals), took into account the documents on record, the
statutory provisions as also decisions of various Courts and
Tribunals. The Tribunal’s conclusions on the issue may be noted:-
“13. When
we apply above principles on the facts of the present case we notice
that the impugned purchases are recorded in the regular books and are
taken into account for the purposes of working out the taxable income
and no material is found in the search regarding bogus nature of
these purchases. Post search investigation carried out by the A.O.
indicated that these purchases might be bogus. Therefore addition
relating to these purchases would fall for consideration in regular
assessment and not in block assessment.
14. Before
concluding this issue we may mention that Id.D.R. argued against the
assessee making a new case by arguing that impugned purchases would
not fall for consideration in block assessment because no
incriminating I relating to these purchases was found in the search.
This argument is tainable because parties are at liberty to raise
addition ground if no ts are required to be investigated and the
issue can be adjudicated on s of material available on record as held
by Hon’ble Supreme Court in case 229 ITR 383 (S.C.). If additional
ground can be permitted to be raised then there is no reason why a
new argument based on available material on record cannot be allowed
to be raised by the parties. Accordingly, the learned CIT(A) is right
in deleting the addition, which we confirm, though on different
reasons. Accordingly, Ground Nos.I and 2 of the revenue are
dismissed.”
6. Having
perused the orders on record, we were of the opinion that the
findings of the Tribunal, prima facie, do not call for any
interference unless of course, observations of the Tribunal are not
borne out from the material on record. In that view of the matter, we
had permitted counsel for the Revenue to place for our consideration
the documents which were part of the record to examine whether there
was any material seized during the search operations which would be
relatable to the additions made by the Assessing Officer which are
disputed before us.
7. Counsel
for the Revenue had accordingly produced copies of such documents.
We had perused such documents with the assistance of the counsel. We
find that there was nothing unearthed during the search operations
nor any documents were collected during such search operations which
had any link with the additions made by the Assessing Officer during
finalizing block assessment proceedings.
8. This
being the position, the view of the Tribunal that such additions
could not have formed part of the block assessment, calls for no
interference. We reiterate and clarify that since decision of the
Tribunal is perfectly in order, no question of law arises. Tax Appeal
is, therefore, dismissed.
(Akil Kureshi,
J. )
(Ms. Sonia
Gokani, J. )
sudhir
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