Delhi High Court
Goojar Mal Ganpat Rai vs Commissioner Of Income-Tax on 29 January, 2004
Equivalent citations: (2004) 192 CTR Del 550, 2004 268 ITR 191 Delhi
Bench: B Patel, B D Ahmed
JUDGMENT
1. Admit.
2. The following question requires consideration :
"Whether, on the facts and circumstances of the case, the finding of the Income-tax Appellate Tribunal confirming an ad hoc addition of Rs. 1,50,000 out of Rs. 2,00,000 made by the Assessing Officer on account of alleged excess stock was perverse and without any material to support the finding ?"
3. At the request of both counsel, we have taken up the matter for final hearing and dispense with the paper book.
4. We have read the order made by the Assessing Officer as well as the Income-tax Appellate Tribunal. The question is about the perversity of the finding with regard to the addition of Rs. 2 lakhs by the Assessing Officer, which has been reduced to Rs. 1.5 lakhs by the Appellate Tribunal. On page 25 of the paper book, the Assessing Officer has held as under :
"The views of the assessed are considered and are reasonable. However, there are a number of instances where order/estimate forms are stated to have been converted into final bills after the date of search as per show cause dated March 20, 1997. Therefore, such stock was not included in the surrender of income made and therefore, a sum of Rs. 2 lakhs is added to the investment in stock sent to parties before the date of search for which bills were raised after the search. The rest of the transaction as per the seized papers taken as covered by the additional investments declared after also taking into account the unaccounted expenses of the assessed as per the seized record."
6. The Appellate Tribunal, on page 15, para. 13, has considered some of the aspects. However, at the end of para. 14, at page 17, it held as under :
"Since the assessed has not been able to file any reconciliation of excess stock vis-a-vis stock with its customer, we therefore, hold that the addition for excess stock was bound to be upheld in the case of the assessed. However, the Assessing Officer did not give complete basis for arriving at the estimate of Rs. 2 lakhs. We, therefore, keeping in view the entirety of the facts, circumstances of the case and the surrender so made by the partners vis-a-vis the income surrendered by the partnership firm, consider it just and reasonable to sustain ad hoc addition of Rs. 1.5 lakhs as against Rs. 2 lakhs made by the Assessing Officer. The ground of the Revenue stands partly allowed."
7. The Tribunal ought to have examined the matter as to why it would like to interfere and reduce the amount of Rs. 2 lakhs to Rs. 1.5 lakhs or ought to have arrived at a conclusion that addition is not required to be made. After holding that the Assessing Officer had not given the basis for arriving at the estimate of Rs. 2 lakhs it committed the same error by ordering an ad hoc addition of Rs. 1.5 lakhs, without any cogent reasons or basis. Such a finding, which is without any basis amounts to a perverse finding.
8. Learned counsel are in agreement that the matter is required to be remanded back to the Tribunal. However, on behalf of the Revenue, it is stated that only quantification is required to be carried out. On behalf of the appellant, it was urged that there is no addition required to be made on account of unaccounted transaction as, whatever has been declared has been accepted. We are not entering into the merits of this part of the controversy. We leave it to the Tribunal to decide the same in accordance with law and evidence adduced on record.
9. It would be open for the Tribunal to remand the matter to the Assessing Officer if it deems it to be just and proper.
10. A copy of this order be given dusty under the signature of the court master.
