Commissioner of Income Tax - I V. V. Dhana Reddy

ITTA/318/2013

AI Insights

The case involves an appeal by the Commissioner of Income Tax-I, Visakhapatnam against the decision of the Tribunal which had deleted an addition of Rs.49,24,069 to the assessee's income for the assessment year 2002-03. The Tribunal had accepted affidavits from two individuals, P. Rajasekhara Reddy and A. Shivanagi Reddy, who claimed to have paid the said amount as transport charges, thus establishing the source of the cash credit. The main legal issues revolved around the acceptance of these affidavits without cross-examination and the Tribunal's finding that only 10% of these receipts should be treated as income. The High Court dismissed the appeal, agreeing with the Tribunal's findings and noting the absence of a request for cross-examination by the appellant.

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 679598 (HC-ANDHRA_PRADESH)
• Appeal Type: Others
• Pronouncement Date: 07-08-2013
• Assessment Year: misc
• Result in Favour of: Others
• Court: HIGH COURT
• Keywords: Affidavits; Assessment Year 2002-03; Cash credit; Cross Examination; Cross-examination; Income Tax; Trade receipts

Judgement Text

"IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA AND THE HON’BLE SRI JUSTICE K.C. BHANU I.T.T.A. No. 318 of 2013 DATE: 07.08.2013 Between: Commissioner of Income Tax-I, Visakhapatnam. … Appellant And V. Dhana Reddy, Visakhapatnam. … Respondent This Court made the following: THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA AND THE HON’BLE SRI JUSTICE K.C. BHANU I.T.T.A. No. 318 of 2013 JUDGMENT: (Per the Hon’ble the Chief Justice Sri Kalyan Jyoti Sengupta) This appeal is preferred against the judgment and order of the learned Tribunal, dated 16.09.2009, in relation to the assessment year 2002-03 and sought to be admitted on the following suggested questions of law. A. Whether on the facts and circumstances of the case, the Appellate Tribunal is justified in deleting the addition of Rs.49,24,069/- though source of cash credit has not been established by the assessee as required in law? B. Whether the Tribunal was justified in accepting the purported affidavits of P. Rajasekhara Reddy and A.Shivanagi Reddy without allowing to the department, the opportunity of examining truth or otherwise of the contents of such affidavits? C. Whether the finding of the Tribunal that the sum of Rs.49,24,069/- represents trade receipts and that 10% of such trade receipts should be treated as income of the assessee is based on material on record.? We have heard the learned counsel for the appellant and gone through the impugned judgment and order of the learned Tribunal. All the three points are really directed towards the fact findings of the learned Tribunal that the assessee has established that there has been a cash flow of an amount of Rs.49,24,069/- and the source of that receipt was also established by producing evidence. The learned Tribunal on fact found that the aforesaid amount represent the business transaction relating to receipt of transport charge and such receipt is proved by additional evidence, i.e., two affidavits of two persons, namely; Sri P. Rajasekhara Reddy and Sri A. Shivanagi Reddy. The said persons have admitted and stated that they have paid the entire amount of Rs.49,24,069/-. When the learned Tribunal has found on fact supported by material evidence, we cannot admit the appeal on such fact finding. As far as not giving of the opportunity of cross-examination of the two persons is concerned, we think there is no allegation in the grounds that the appellant prayed for such cross-examination and such prayer was rejected by the learned Tribunal. The evidence given in examination-in-chief by way of affidavit, at the first instance, should not be disbelieved. According to us, the evidence is ordinarily complete and composite when cross-examination is sought to be done. If there is any doubt in the mind of any one that such statement may not be true, then one can always pray for examining those deponents before the forum concerned, namely; here the Tribunal. Of course, right of cross-examination is always waivable right. If such right is not asserted at the appropriate time, it shall be presumed that the party or person concerned is deemed to have waived such right and the evidence given in examination-in-chief by way of affidavit has to be taken as final and its evidentiary value has to be assessed. So far as the estimation of profit at 10% of the trade receipt is concerned, it is a discretionary exercise on the facts and circumstances of a particular case and this discretion cannot be substituted. Hence, we do not find any infirmity or illegality in the impugned judgment and order of the learned Tribunal to admit the appeal. Accordingly, the appeal is dismissed. _____________________ K.J. SENGUPTA, CJ ________________ K. C. BHANU, J Date: 07.08.2013 ES "