2014 (5) TMI 1151 - HC - Income Tax

Unexplained loans and cash credits - absence of any evidence or material from the side of the assessee - Held that - The books of accounts were neither produced before the assessing officer nor before CIT(Appeals). The Tribunal also noted that no steps were taken in bringing evidence on record, even before the Tribunal and for the purpose of additional evidence, there was absence of any application. Such non-cooperative attitude of the appellant led the Tribunal not to accede to the request of the appellant. Considering these glaring facts coupled with the fact that these findings are completely based on the factual matrix and no perversity could be noticed in such findings which would have given rise to substantial question of law. - Decided against assessee

Summary

Issues:
- Challenge to the order of the Income Tax Appellate Tribunal based on substantial questions of law.
- Disallowance of addition under section 68 of the Income-tax Act, 1961.
- Request for remand to the assessing officer by the appellant.

Analysis:
1. The appellant challenged the order of the Income Tax Appellate Tribunal based on substantial questions of law. The Tribunal confirmed the addition of Rs. 12,00,000 under section 68 of the Income-tax Act, 1961. The appellant contended that the loans were taken from a group company through banking channels, and the identity, creditworthiness, and genuineness of the transactions could be verified from the records. However, the Tribunal noted the non-compliance of statutory notices, failure to produce books of accounts, and lack of evidence or material from the appellant's side. The Tribunal found no justification to interfere with the orders of the authorities below and dismissed the appeal.

2. The assessing officer had added a substantial loan amount to three parties as a diversion of interest-bearing funds for non-business purposes. The appellant sought a remand to the assessing officer, which was not allowed by the Tribunal. The Tribunal highlighted the appellant's non-cooperative attitude, as evidenced by the failure to produce books of accounts, lack of steps to bring evidence on record, and absence of any application for additional evidence. Due to these factors and the factual basis of the findings, the Tribunal upheld the decision of the authorities below and dismissed the appeal.

3. The Tribunal emphasized that the appellant did not provide any explanation, reasons, or evidence for non-compliance with statutory notices. The lack of cooperation from the appellant, including the failure to furnish details or produce books of accounts, led to the dismissal of the appeal. The Tribunal found no perversity in the factual findings and concluded that there was no basis for remanding the matter to the assessing officer. Consequently, the Tax Appeal was dismissed, as the findings were based on the factual matrix and did not give rise to any substantial question of law.