2009 (8) TMI 5 - HC - Income Tax

Undisciplined Income - Order of the Tribunal restoring the issue of charging interest u/s 158 BFA(1) non production of any details/evidence before the Ld.CIT(A) or the Assessing Officer despite opportunities allowed by both of them. held that - findings recorded by the Tribunal are findings of fact based on appreciation of evidence not to be interfered with being no substantial question of low arises.

Summary

The High Court of Punjab and Haryana heard an appeal under Section 260A of the Income Tax Act, 1961, filed by the revenue against an order by the Income Tax Appellate Tribunal. The case involved a block assessment from 1.4.1989 to 31.3.1999. The substantial questions of law proposed by the revenue included issues related to undisclosed investments, addition of undisclosed investments, and charging of interest under Section 158 BFA(1). The documents found during a search under Section 132(1) of the Act led to the issuance of a notice under Section 158 BD to the assessee, who declared his undisclosed income as 'Nil'. The Assessing Officer made assessments based on unexplained investments in a car purchase and a firm, M/s Sabharwal International, and directed interest recovery. The CIT(A) upheld the assessment on the car purchase but partially deleted the addition related to the firm and upheld the interest levy. The Tribunal remanded the car purchase and interest issues to the Assessing Officer and upheld the part deletion concerning the firm. The Tribunal's findings were based on the need for the assessee to substantiate entries found in seized material and the lack of evidence provided by the assessee. The CIT(A) restricted the addition based on the partner's statement and the assessee's share of investment. The Tribunal found no reason to interfere with the CIT(A)'s order. Regarding the interest charge, the Tribunal emphasized the need to establish the assessee's default before penalizing and highlighted that the levy of interest under Section 158 BFA(1) is not automatic. The High Court concluded that the Tribunal's findings were based on fact and evidence appreciation. The matter was remanded to provide the assessee with further opportunities. No substantial questions of law were found, and the appeal was dismissed.