2010 (3) TMI 1140 - AT - Income Tax

Summary

Issues Involved:
1. Adjournment Request and Opportunity of Being Heard
2. Genuineness of Trade Creditors and Addition u/s 68
3. Powers of the Tribunal u/s 254(2)

Summary:

1. Adjournment Request and Opportunity of Being Heard:
The assessee's grievance was that the appeal in ITA No.1277/08 was disposed of without conceding to the request for adjournment or affording an opportunity of being heard. The Tribunal, after considering the request for adjournment, decided the issue on merits based on available records, reasoning that sufficient opportunities had already been provided.

2. Genuineness of Trade Creditors and Addition u/s 68:
The assessee, a dealer in rice, had an addition of Rs. 5.04 lakhs u/s 68 due to failure to produce creditors for verification. The CIT(A) sustained the addition, which was later remitted back to the AO by the Tribunal for fresh consideration. During reassessment, the assessee produced only two trade creditors, whose genuineness was not proven. The AO retained the addition, and the CIT(A) deleted Rs. 1.26 lakhs but sustained Rs. 3.78 lakhs. The Tribunal confirmed the CIT(A)'s findings, emphasizing the assessee's failure to prove the genuineness of trade creditors.

3. Powers of the Tribunal u/s 254(2):
The Tribunal, referencing the jurisdictional High Court's ruling in CIT & Anr. v. Mcdowell and Company Ltd. (2009) 310 ITR 215, stated that it has no power to recall and review its earlier order u/s 254(2). The Tribunal dismissed the Misc. Petition, concluding that sufficient opportunities were provided, and the earlier order did not suffer from any infirmity or mistake requiring rectification.

Conclusion:
The Tribunal dismissed the Misc. Petition of the assessee, stating that sufficient opportunities were provided to prove the genuineness of trade creditors, and the Tribunal's earlier order did not require rectification. The Tribunal emphasized its limited powers u/s 254(2) and upheld the addition u/s 68.