Sri Devaraj Moorjani V. The Deputy Commissioner of Income Tax, Hyderabad and another

ITTA/50/2009

AI Insights

The case involves appeals by Sri Devaraj Moorjani and his family against the orders of the Income Tax Appellate Tribunal, which upheld the additions made by the lower authorities regarding undisclosed 'on money' payments for property purchases during the block periods from 1988-89 to 1998-1999. The Tribunal's decision was based on confessions made by Sri Devraj Moorjani and Sri Shamraj Moorjani, along with incriminating material found during search operations. The appellants challenged the Tribunal's findings, arguing that there was no independent evidence to support the confessions. However, the High Court dismissed the appeals, agreeing with the Tribunal's findings and emphasizing that the appreciation of evidence is not within the scope of the High Court's review under Section 260-A.

• Counselvise Citation: [2009] 140 COUNSELVISE.COM (IT) 797128 (HC-HYDERABAD)
• Appeal Type: Others
• Pronouncement Date: 13-11-2009
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Assessee Lawyers: PILLI NAGARAJ
• Keywords: Confessional statement; Incriminating material; On-money payment; Search Operations; Substantial question of law
• Section: 260-A

Judgement Text

"THE HONOURABLE SRI JUSTICE GODA RAGHURAM AND THE HONOURABLE SRI JUSTICE RAMESH RANGANATHAN ITTA NOS.50 AND 51 OF 2009 13-11-2009 BETWEEN; Sri Devaraj Moorjani ...Petitioner vs. The Deputy Commissioner of Income Tax, Hyderabad and another ...Respondents THE HONOURABLE SRI JUSTICE GODA RAGHURAM AND THE HONOURABLE SRI JUSTICE RAMESH RANGANATHAN ITTA NOS.50 AND 51 OF 2009 ORAL COMMON ORDER: (Per RR,J) ITTA Nos.50 and 51 of 2009 are preferred against the common order in I.T.(SS) Nos.11 and 14/Hyd/2007 dated 27.02.2009, to the extent the Income Tax Appellate Tribunal, (Bench-B), Hyderbad upheld the order passed by the C.I.T.(Appeals). These appeals, preferred under Section 260-A of the Income Tax Act,1961, (for short “the Act”), can be entertained by the High Court only on its being satisfied that the case involves a substantial question of law. Sri Pilli Nagaraj, learned counsel for the appellant in both the appeals, would submit that, for the block periods 1988-89 to 1998-1999, all six family members of the appellant together were held liable to pay Rs.1,69,18,191/-. He would submit that the main ground on which the Tribunal had rejected their appeals was that on money payments, over and above the sale consideration disclosed in the sale deed, were unearthed during the course of search operations and that this fact was not disclosed to the Department by the assessee in the income tax returns filed earlier. Learned counsel would submit that except for the confessional statement of Sri Devraj Moorjani no independent evidence was gathered, such as examination of vendors etc., to ascertain whether any on money payment was made over and above the sale consideration. In the order, under appeal, the Tribunal has referred to the fact that when Sri Devraj Moorjani was examined, on the basis of incriminating material found during the course of search operations, he had admitted that there was an on money payment of Rs.12 lakhs for purchase of the property and that this was further confirmed by Sri Shamraj Moorjani. With regards the CBDT Circular relied upon on behalf of the assessee, the Tribunal observed that, while these instructions required the officers to concentrate on collecting material evidence during the course of search operations rather than compelling the assessee to make a confession, the present case was not a mere confession or admission made by the assessee and when the Department sought clarification, on the basis of incriminating material, both Sri Devraj Moorjani and Shamraj Moorjani had clarified that they had made on money payments to the extent of Rs.12 lakhs. The Tribunal further held that this statement was based on the incriminating material found during the course of search operation and that the lower authorities had rightly made the addition of Rs.12 lakhs in respect of the property at Aushapur village. With regards the property at Krishna Nagar Colony, Yousufguda, Hyderabad, the Tribunal records that, on examination during the course of search operation and on the basis of the incriminating material found during the course of search operation, Sri Devraj Moorjani and Shamraj Moorjani had admitted that there was on money payment of Rs.25 lakhs for purchasing the property at Krishna Nagar Colony and, since this admission was made on the basis of the material found during the course of search operation, there was no merit in their contention. The Tribunal further observed that the lower authorities had rightly made the addition in respect of Krishna Nagar Colony Property to the extent of Rs.25 lakhs. The appellants in both these appeals, in effect, seek re-appreciation of the evidence on record. A substantial question of law arises only when the findings recorded by the authorities/tribunal are perverse. Where on the same facts if two conclusions are possible and, even if this Court were of the view that the conclusion suggested by the assessee was more attractive, it would, nonetheless, refrain from interference inasmuch as appreciation of facts is within the exclusive jurisdiction of the authority/Tribunal, and not the High Court in an appeal under Section 260- A of the Act. It is only on a substantial question of law, and if the findings recorded by the Tribunal are perverse, would the High Court interfere. We are satisfied that the order of the Tribunal does not suffer from perversity or any other infirmity warranting interference. Both these appeals are, accordingly, dismissed. ______________ GODA RAGHURAM,J __________________ RAMESH RANGANATHAN,J 13th NOVEMBER 2009 TSNR "