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Issues involved: Appeal u/s 260A of the Income-tax Act, 1961 against the order of the Income-tax Appellate Tribunal for the assessment year 1990-91 regarding trade credit claimed by the assessee.
Summary: The High Court dismissed the appeal filed by the assessee against the order of the Income-tax Appellate Tribunal. The Tribunal had reversed the finding of the CIT(A) regarding the genuineness of the trade credit claimed by the assessee. The Tribunal emphasized the need for the assessee to prove the identity and genuineness of the trade creditors. The assessee failed to provide complete addresses of the trade creditors and consignors, making verification by the Assessing Officer impracticable. The Tribunal held that the genuineness of the transaction could not be established solely based on the large number of unidentified trade creditors. The Tribunal concluded that the assessee was not entitled to deduction on that account. The assessee argued that the entry in the account books as trade liability should not be treated as income without a valid basis. However, the Tribunal did not find merit in this argument and maintained that the assessee could not claim deduction for the trade credit. The High Court noted that the issue raised by the assessee pertained to the appreciation of evidence and did not find any substantial question of law arising from the appeal. Therefore, the High Court dismissed the appeal. This judgment highlights the importance of establishing the genuineness of transactions and the necessity for providing complete information to support claims, especially in cases involving trade credits and liabilities.
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