2002 (8) TMI 51 - HC - Income Tax

Whether on the facts and in the circumstances of the case the Appellate Tribunal was right in law in holding that the provisions of section 68 are not attracted in respect of the alleged capital contribution of Rs. 60, 000 and in deleting the relevant addition while the account copy in the books of the firm shows the amount of Rs. 60, 000 as cash received contrary to the explanation offered during the course of assessment proceedings? - We find that the Appellate Tribunal has arrived at the conclusion that the sum of Rs. 60, 000 was not the undisclosed income of the firm on the basis of the materials available on record and on the basis of the statement of Thiagarajan which was believed and accepted by the Tribunal we are therefore of the view that the finding recorded by the Tribunal on the basis of the material is a pure finding of fact and does not call for any interference by this court. We do not find any question of law that arises out of the order of the Tribunal. Accordingly we answer the question of law referred to us in favour A of the assessee and against the Revenue.

Summary

The High Court of Madras ruled in favor of the assessee in a tax case reference for the assessment year 1982-83. The court upheld the Income-tax Appellate Tribunal's decision that a capital contribution of Rs. 60,000 was not undisclosed income, as the amount was paid for specific purposes before the firm's business commencement. The court found no legal question to challenge the Tribunal's factual conclusion.