2013 (5) TMI 884 - HC - Income Tax

Summary

Issues involved:
The issues involved in this case are the deletion of additions made by the Assessing Officer on account of income from undisclosed sources and the failure of the assessee to provide documentary evidence to explain deposits in the bank account.

Deletion of Additions:
The case involved the deletion of additions made by the Assessing Officer on various sums found credited in the bank account of the respondent assessee. The assessee could not provide a satisfactory explanation initially, leading to the additions. However, in the appellate proceedings, additional evidence was admitted by the Commissioner after calling for a remand report. The CIT(Appeals) reversed the decision of the Assessing Officer based on the additional material and other evidence on record. The Tribunal dismissed the Revenue's appeal on the grounds that the assessing authority did not consider each deposit separately, the assessee explained the deposits to the satisfaction of the CIT(A), and there was no adverse material to show that the recovery of advances was not real. The Tribunal was satisfied with the explanation provided by the assessee, and no interference was warranted in the deletion of the additions.

Appreciation of Facts:
The entire issue revolved around the appreciation of facts. The CIT(Appeals) and the Tribunal, based on the materials on record and additional evidence allowed during the appellate proceedings, concluded that the credits were duly explained by the assessee. The Tribunal agreed with the CIT(Appeals) based on independent reasoning. It was held that no question of law arose from the facts presented.

Clarification on Section 68:
The Court clarified that they did not confirm the Tribunal's opinion that certain cash credits found in the bank account but not shown in the accounts, due to the absence of maintained accounts by the assessee, cannot be considered for addition under section 68 of the Income Tax Act.

In conclusion, the Tax Appeals were dismissed by the High Court, affirming the decisions of the CIT(Appeals) and the Tribunal regarding the deletion of additions made by the Assessing Officer.