2020 (10) TMI 1028 - HC - Income Tax

Unaccounted cash receipts - material on record that this amount was paid to M/s. Good Earth Developers and M/s. Raj Hospitality Pvt. Ltd - HELD THAT - Nature of such amounts can be very well assessed in the hands of said recipients and need not be assessed in the hands of the assessees.Since there is material on record that this amount of Rs. 11.26 crores or thereabouts was paid by the assessee to the aforesaid two entities and since there is evidence on record that the aforesaid two entities had admitted to the receipt of the said amount the Commissioner (Appeals) was quite right in taking the view that such amounts are best assessed in the hands of the two entities and not in the hands of the assessee. Unable to satisfy us that there was any illegality in the view taken or any perversity in the approach of the Commissioner (Appeals) in so far as the treatment of this amount was concerned. Accordingly the first substantial question of law needs to be answered against the Revenue and in favour of the assessees. This question is answered against the Revenue only because we agree with the view taken by the Commissioner (Appeals) that it is only appropriate that this amount is assessed in the hands of the two recipient entities as aforesaid and not the assessee - Decided in favour of assessee. Addition u/s 68 - Unexplained cash credit - HELD THAT - Even if we were to accept that the assessee by pointing out to Mr. Siraj Sheikh Vijay Kumar Rao and M/s. Prasad Properties had discharged the initial burden cast upon them by Section 68 we find that the onus which had shifted upon the Revenue has been appreciably discharged by the Revenue. This is not a case where the Revenue halted its probe soon after the so-called sources were indicated by the assessee. Revenue in these matters probed further and unearthed quality material to establish that the socalled sources completely lacked the capacity or credit-worthiness to advance such a huge amount of Rs. 8.49 crores to the assessees.Revenue in these matters established that there was no genuineness in the transactions sought to be projected on behalf of the assessees. Therefore the Revenue in these matters has discharged the onus assuming that such onus had indeed shifted upon the revenue. Again this is an aspect which was ignored by the ITAT. The finding recorded by the ITAT in these matters is based upon the wholly erroneous view of law and perversity on account of ignoring completely vital and relevant circumstances emanating from the record. Such a finding can be interfered in an appeal under Section 260A of the said Act. The legal position is quite settled that where the findings arrived at by the Tribunal are based upon the wholly erroneous view of the law or are vitiated by perversity a substantial question of law indeed arises and is required to be addressed in an appeal under Section 260A of the said Act. If at all any authority is necessary for this proposition then reference can be usefully made to Nemi Chand Kothari 2003 (9) TMI 62 - GAUHATI HIGH COURT relied upon by the assessees themselves. We answer the second substantial question of law in favour of the Revenue and against the assessee .