2012 (7) TMI 1168 - HC - Income Tax

Summary

Issues involved: Challenge to order of Income Tax Appellate Tribunal u/s 260A of the Income-tax Act, 1961 for assessment year 2005-06.

Summary:
1. The appellant-assessee challenged the order of the Income Tax Appellate Tribunal (ITAT) which partly allowed the appeal for the assessment year 2005-06.

2. The assessing officer passed an assessment order u/s 143(3) assessing income at Rs. 42,68,450, against the returned income of Rs. 1,45,828. The appellant-assessee appealed to the Commissioner (Appeals) and then to the ITAT, which partly allowed the appeal.

3. The appellant argued that the trading addition of Rs. 12,29,950 and another addition of Rs. 6,40,500 were not justified due to lack of evidence and denial of the right to cross-examine a witness.

4. The High Court noted that for an appeal u/s 260A, there must be a substantial question of law. The issues in this case were factual, not legal. The ITAT had thoroughly considered the trading addition issue and the appellant had sufficient opportunity to explain, so no violation of natural justice occurred.

5. The High Court found no merit in the appeal as it did not involve any substantial question of law. The appeal was dismissed.

This judgment highlights the importance of substantial questions of law for appeals u/s 260A and emphasizes the need for proper evidence and opportunities for explanation in tax assessment cases.