2009 (7) TMI 665 - HC - Income Tax

Appeal to High Court- The Assessing Officer during the course of assessment made certain addition u/s 68 of the Act, holding that the assessee had failed to establish the identity, genuineness and creditworthiness of the transactions. In the course of appellate proceedings, the assessee furnished confirmation letters which were forwarded to the Assessing Officer. The Assessing Officer sought time for verification but failed to send his request. The Commissioner (Appeals) allowed the appeal of the assessee accepting additional evidence. The Tribunal held that the Commissioner (Appeals) should have awaited the opinion of Assessing Officer or should have conducted inquiry himself as provided under section 250(4) of the Act remitted the matter for fresh decision. Held that- the Tribunal had merely remanded the matter with the finding that the Commissioner (Appeals) had not enquired into the matter. In the order, option had been left to the Commissioner (Appeals) to either look into the matter himself or to have a verification done from the Assessing Officer. No prejudice was caused to the assessee. The view taken by Tribunal was a possible view.

Summary

The High Court of Punjab & Haryana heard an appeal under section 260A of the Income-tax Act, 1961 against the orders of the Income-tax Appellate Tribunal for the assessment year 2004-05. The substantial questions of law proposed were related to the setting aside of issues to the file of the Commissioner of Income-tax (Appeals) without proper appreciation of findings and evidence. The Assessing Officer made additions under section 68 of the Act due to the failure of the assessee to establish the identity, genuineness, and creditworthiness of transactions. The Commissioner of Income-tax (Appeals) accepted additional evidence presented by the assessee, but the Tribunal remitted the matter for fresh decision. The Tribunal concluded that the Commissioner of Income-tax (Appeals) should have directed the Assessing Officer to examine the parties to establish the necessary details, and remanded the issue accordingly. The appellant argued that the remand was unnecessary as the Commissioner of Income-tax (Appeals) had properly analyzed the evidence. The Tribunal's decision was considered a possible view, and the appeal was ultimately dismissed.