2022 (10) TMI 1054 - HC - Income Tax

Addition of unsecured loan - primary evidences like confirmation accounts and acknowledgment of filling return of income Pan Card of depositors and audit report u/s 44AB of a Chartered Accountant who is like eye witness of having verified the books of accounts and the other related documents is on record of the Department and all these transactions are routed through Bank - HELD THAT - On perusal of the orders it appears that there are concurrent findings of fact arrived at by the CIT (A) as well as the Tribunal to the effect that the Assessee has failed to produced the books of accounts and other relevant materials which was required by the AO to inquire into the transactions of unsecured loans undertaken by the appellant-assessee for the year under consideration. With regard to the addition made on account of the expenses also, there is no material available on record as per the findings of fact arrived at by the CIT(Appeals) and the Tribunal. The addition made on account of advance for goods is also not supported by any documentary evidence. Moreover, no one has come forward to give statement u/s 133(6) of the Act, 1961 and notices under Section 133(6) were not complied with. We are of the opinion that no question of law much less any substantial question of law as proposed or otherwise arises from the impugned order of the Tribunal and accordingly, the Appeal stands dismissed.

Summary

Issues:
Challenge to judgment and order passed by Income Tax Appellate Tribunal for Assessment Year 1998-99.

Analysis:
The appeal under Section 260-A of the Income Tax Act, 1961 challenges the Tribunal's decision on various substantial questions of law. The history of the case reveals multiple rounds of litigation between the assessee and the department. In the first round, an assessment order was passed under Section 144 due to the assessee's failure to produce books of accounts, resulting in best judgment assessment. The CIT (Appeal) confirmed this order. However, in subsequent rounds, the Tribunal set aside the assessment orders, leading to a de-novo assessment by the Assessing Officer. The additions made in the third round included unsecured loans, expenses, and advances against goods, all of which were challenged by the assessee.

The Tribunal dismissed the assessee's appeal, emphasizing the failure to produce essential documents like books of accounts, vouchers, bills, and bank statements. Despite arguments regarding the necessity of such documents, the Tribunal upheld the CIT (Appeals) decision due to the lack of evidence submitted during appellate proceedings. The Tribunal's detailed findings highlighted the importance of verifying transactions through proper documentation, which the assessee failed to provide.

The appellant-assessee contended that all necessary details were furnished to the Assessing Officer but could not produce documents due to loss over time. Additionally, the appellant argued that the Department should not have filed an appeal in the second round based on tax effect guidelines. However, the Tribunal found concurrent findings by the CIT (Appeals) and itself regarding the assessee's failure to provide essential materials for scrutiny, leading to the dismissal of the appeal. The Tribunal concluded that no substantial question of law arose from the impugned order, resulting in the dismissal of the appeal.

In summary, the judgment addresses the repeated litigation between the assessee and the department, emphasizing the importance of producing necessary documents for scrutiny assessments. The Tribunal's decision to dismiss the appeal was based on the lack of evidence provided by the assessee, highlighting the significance of proper documentation in verifying transactions and justifying additions made by the Assessing Officer.