SARISHTI PAUL V. COMMISSIONER OF INCOME TAX,JALANDHAR

ITA/125/2000

AI Insights

The case involves an appeal by Shri Sarishti Paul against the Commissioner of Income Tax, Jalandhar, concerning an addition of \\u20b92,48,048 to his income, which was deemed as unexplained investment in the construction of a factory building at Noida. The appellant challenged the legality of this addition, arguing that the construction spanned over three years and the addition was made in a single assessment year. The Revenue's counsel could not provide the necessary records to substantiate the addition for the specific year, leading to the court's decision to remand the matter for re-assessment with the opportunity for the appellant to present further material.

• Counselvise Citation: [2020] 140 COUNSELVISE.COM (IT) 760144 (HC-CHANDIGARH)
• Appeal Type: Others
• Pronouncement Date: 03-03-2020
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: VIVEK SETHI; VARUN ISSHAR
• Assessee Lawyers: ALOK MITTAL
• Keywords: Assessment Year; Construction; Factory building; Presumptions and Conjectures; Unexplained investment
• Section: 260A

Judgement Text

"ITA No.125 of 2000 -1- 388-1 IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH **** ITA No.125 of 2000 Date of Decision: 03.03.2020 Shri Sarishti Paul Appellant Versus Commissioner of Income Tax, Jalandhar and another Respondents CORAM: HON'BLE MR. JUSTICE AJAY TEWARI HON'BLE MR. JUSTICE AVNEESH JHINGAN Present: Mr. Alok Mittal, Advocate for the appellant. Mr. Vivek Sethi, Sr. Standing Counsel and Mr. Varun Isshar, Jr. Standing Counsel for the Revenue. **** AJAY TEWARI, J. (Oral) [1] This appeal has been filed under Section 260A of the Income Tax Act, 1961 against the order passed by the Income Tax Appellate Tribunal, Amritsar, challenging an addition of `2,48,048/-, which as per the Revenue, was unexplained investment for construction which the appellant had carried out claiming following substantial questions of law:- “(i) Whether in the facts and circumstances of the case, the orders Annexures P-1, P-2 and P-6 can be sustained at law? (ii) Whether in the facts and circumstances of the case, the addition of Rs.2,48,048/- on account of alleged unexplained investment in the construction of factory building at Noida can be legally sustained in as much as the construction of the building was over a span of three years whereas the addiiton PANKAJ BAWEJA 2020.03.05 16:18 I attest to the accuracy and integrity of this document High Ciourt, Chandigarh ITA No.125 of 2000 -2- on account of difference has been made in one assessment year alone? (iii) Whether in the facts and circumstances of the case, the addition of Rs.2,48,048/- on account of alleged unexplained investment in the construction of factory building at Noida can be legally sustained in as much as the rate taken by te D.V.O. as per the Office premises and not per the factory rate as the building constructed at Noida were factory premises of the assessee-appellant? (iv) Whether in the facts and circumstances of the case, the addition of Rs.2,48,048/- on account of alleged unexplained investment in the construction of factory building at Noida can be sustained at law the same being based on mere presumptions and conjectures which can not form the basis for adjudication?” [2] On 27.01.2020, following order was passed:- “The issue which arises in these two appeals is whether unexplained income could be added in the single year of assessement or whether it had to travel back towards relevant years in which the construction was done. Adjourned to 04.02.2020. A photocopy of this order be placed on the file of connected case(s).” [3] On 10.02.2020, learned counsel for the Revenue stated that the issue which had been raised could not be verified by him as the record is not available. [4] Today again learned counsel for the Revenue states that record is not available. He is not in a position to deny that in such a case the addition would have to be made for the period in which construction was carried out and could not be totaled at in the last PANKAJ BAWEJA 2020.03.05 16:18 I attest to the accuracy and integrity of this document High Ciourt, Chandigarh ITA No.125 of 2000 -3- year. [5] Learned counsel for the appellant states that the appellant has certain material which may enable the authorities below to decide this issue. [6] In these circumstances, the appeal is allowed. The impugned order qua addition of `2,48,048/- is set aside and matter is remanded back to the assessing officer to work out the tax liability as per law after considering the material which the appellant may produce. [7] Since the appeal is disposed of, the pending application, if any, also stands disposed of. [AJAY TEWARI] JUDGE [AVNEESH JHINGAN] JUDGE March 03, 2020 pankaj baweja 1. Whether speaking/ reasoned : Yes / No 2. Whether reportable : Yes / No PANKAJ BAWEJA 2020.03.05 16:18 I attest to the accuracy and integrity of this document High Ciourt, Chandigarh "