2007 (1) TMI 125 - HC - Income Tax

Summary

Issues involved: The judgment involves the interpretation of Rule 46A of the Income-tax Rules, 1962, and the decision of the Tribunal regarding the admission of additional evidence, deletion of income from undisclosed investments, and the perversity of the Tribunal's decision.

Interpretation of Rule 46A and Admission of Additional Evidence: The assessee filed his return of income for the assessment year 1998-99 and disclosed certain bank accounts. The Assessing Officer added Rs. 23 lakhs to the income of the assessee based on two other bank accounts. The assessee appealed before the Commissioner of Income-tax (Appeals) to adduce additional evidence. The Tribunal held that the adducing of additional evidence was in accordance with the law. The Tribunal considered the merits and dismissed the appeal filed by the Revenue. The court found that the adducing of additional evidence was done to ensure substantial justice and did not prejudice either party. The court noted that the Revenue had sufficient opportunity to rebut the additional evidence. The appeal was dismissed as no substantial question of law emerged.

Deletion of Income from Undisclosed Investments: The Tribunal confirmed the deletion of Rs. 23,00,000 from the assessee's income, which was considered income from undisclosed investments. The Tribunal found that the assessee failed to discharge the primary onus of showing that the apparent income was not real. The court did not find any substantial question of law in this regard.

Perversity of Tribunal's Decision: The Tribunal's decision to uphold the order of the Commissioner of Income-tax (Appeals) was challenged as being perverse. However, the court found that the Tribunal's decision was in accordance with the law and did not prejudice the Revenue. The court held that no substantial question of law arose in this aspect.