1997 (6) TMI 48 - AT - Income Tax

Summary

Issues Involved:
1. Refusal to admit additional evidence under Rule 46A.
2. Determination of remittances as income from undisclosed sources.
3. Scope of application under Section 254(2) of the Income-tax Act.
4. Non-disposal of application under Rule 29 of the Income-tax (Appellate Tribunal) Rules, 1963.

Issue-wise Detailed Analysis:

1. Refusal to Admit Additional Evidence under Rule 46A:
The Tribunal upheld the Commissioner (Appeals)'s decision to refuse the admission of additional evidence, citing that the conditions of Rule 46A were not met. The Tribunal noted that the assessees did not discharge their onus to prove the nature and source of the remittances and that the evidence was not presented at the appropriate time. The Tribunal emphasized that the cause of substantial justice and fair play could not override the procedural rules set forth in Rule 46A.

2. Determination of Remittances as Income from Undisclosed Sources:
The Tribunal concluded that the remittances received from abroad by the assessees were their income from undisclosed sources. This conclusion was based on the material on record, excluding the additional evidence that was not admitted. The Tribunal found that the assessees failed to substantiate their claims regarding the gifts' genuineness, identity of the donor, and the donor's capacity to give such gifts.

3. Scope of Application under Section 254(2) of the Income-tax Act:
The Tribunal clarified that the scope of application under Section 254(2) is limited to rectifying mistakes apparent from the record. The Tribunal rejected the assessees' argument that the Tribunal should recall its order if the Court's conscience is shaken, emphasizing that only mistakes apparent from the record could be addressed under Section 254(2). The Tribunal found no such mistake in the original order.

4. Non-disposal of Application under Rule 29 of the Income-tax (Appellate Tribunal) Rules, 1963:
The Tribunal acknowledged that an application under Rule 29 for the admission of additional evidence was on record but was not disposed of. The Tribunal noted that the application was not argued before the present combination of the Bench, and no arguments were presented to highlight the application during the hearing of the appeals. The Tribunal emphasized that the non-disposal of the application did not constitute a mistake apparent from the record, as the application was not pressed or argued by the assessees' counsel. The Tribunal referenced several legal precedents to support its position that the decision must be based on the pleadings and arguments presented before it.

Conclusion:
The Tribunal dismissed the miscellaneous applications filed by the assessees, finding no merit in the claims. The Tribunal held that the refusal to admit additional evidence under Rule 46A was justified, the remittances were correctly determined as income from undisclosed sources, and there was no mistake apparent from the record regarding the non-disposal of the Rule 29 application. The Tribunal's decision was based on the procedural adherence to the Income-tax Act and the Appellate Tribunal Rules.