Madhya Pradesh High Court
Aradhna Oil Mills vs Commissioner Of Income-Tax And Anr. on 29 August, 2001
Equivalent citations: [2001]252ITR607(MP)
Author: A.M. Sapre
Bench: Deepak Verma, A.M. Sapre
JUDGMENT A.M. Sapre, J.
1. The decision rendered in this appeal shall govern the disposal of two other connected appeals being I. T. A. No. 35 of 2001 and I. T. A. No. 36 of 2001, as all these appeals are filed by the same asscssee and, secondly, these appeals arise out of a common order of the Income-tax Appellate Tribunal except the difference being they relate to different assessment years.
2. This is an appeal filed by an assessee under Section 260A of the Income-tax Act against an order dated February 15, 2001, passed by the Income-tax Appellate Tribunal, Indore, in I. T. A. Nos. 439, 440 and 441/Ind of 1996 arising out of the assessment years 1984-85 to 1986-87. The facts that led to the filing of these appeals need mention in brief.
3. On July 18, 1992, a raid was carried out in the assessee's premises. In this raid operation several incriminating documents were seized which included some bank accounts and statements. Since it was noticed that none of these bank accounts and statements were reflected in the balance-sheet submitted by the assessee, a notice under Section 148 was served on the assessee. As a consequence to it, the assessee filed a revised return. In these assessment proceedings the Assessing Officer ("the AO"), noticed that the assessee had deposited a sum of Rs. 1,41,279 in the Punjab National Bank but there was no entry or/and mention of this amount in the balance-sheet. The assessee was, therefore, asked to explain its source else it was said why the said entry of Rs. 1,41,279 be not treated as an income from unexplained source.
4. The explanation of the assessee in substance was that these deposits were made out of withdrawals made by the assessee from the account itself from time to time.
5. The explanation offered by the assessee did not find favour with the Assessing Officer. He was of the view that it is no explanation much less satisfactory to prove the source. Accordingly, treating this entry of Rs. 1,41,279 to be unexplained in the hands of the assessee, the Assessing Officer added this amount in the total income of the a.ssessee. The assessee feeling aggrieved by this addition went up in appeal to the Commissioner of Income-tax (Appeals). The Commissioner of Income-tax (Appeals) allowed the appeal and deleted the addition. This led to filing of the appeal by the Revenue before the Income-tax Appellate Tribunal. It is these appeals which were allowed by the Income-tax Appellate Tribunal by the impugned orders whereby, it set aside the order of the Commissioner of Income-tax (Appeals) and restored that of the Assessing Officer. It was held by the Income-tax Appellate Tribunal that the assessee has failed to prove the source of income in relation to the amount of Rs. 1,41,279 and hence, they have to be treated as an income from unexplained source. It is against these orders, the assessee has filed these three appeals under Section 260A of the Act.
6. Heard Shri H. C. Sarda, learned counsel for the appellant on the question of admission.
7. Assailing the correctness of the finding returned by the Income-tax Appellate Tribunal holding therein that the assessee has failed to prove . the source of the amount in question, learned counsel for the appellant (assessee) urged that the finding is perverse if not held to be totally without jurisdiction.
8. Elaborating the submission, in substance the emphasis of learned counsel in the argument was that the explanation offered by the assessee ought to have been accepted, it being a cogent one worth accepting.
9. Having heard learned counsel for the appellant and having perused the record of the case, we are of the considered view that the appeal does not involve any question of law much less a substantial question of law as is required to be made out for admission of the appeal under Section 260A of the Act.
10. In effect, the question whether a particular entry in the account book is genuine or not, or whether the assessee is able to show its source is a question of fact. In other words, it only involves appreciation of evidence tendered by the assessee pursuant to a query made by the Revenue. It is for the Assessing Officer to accept the explanation offered or not. No doubt, the first appellate court as also the second appellate court are also empowered to examine the factual background of the issue with a view to examine whether the explanation offered is reliable, adequate or/and proper.
11. But that exercise, the High Court in its third appellate jurisdiction cannot do it by virtue of the specific language employed in Section 260A of the Act.
12. In appeal under Section 260A ibid, the appellant has to make out a substantial question of law arising out of the order of the Income-tax Appellate Tribunal ; then only the interference is called for, else not.
13. As observed supra, this appeal does not involve any substantial question of law so as to empower us to admit this appeal. The explanation offered by the assessee did not find favour with the Assessing Officer and affirmed by the Income-tax Appellate Tribunal. This court cannot now re-examine the whole issue de novo to upturn the impugned finding. It is not the case of the appellant that the Income-tax Appellate Tribunal did not examine the facts while recording the finding against the appellant.
14. Even otherwise, in our opinion, the explanation offered by the assessee had no convincing tone to accept. What was the explanation ? It said that the amount was withdrawn from the same account and redeposited in the account after some time. It was rightly not accepted. It was a clear case where the assessee utilised the cash for purchasing the items and did not account for it in its books.
15. In view of the aforesaid discussion, which is more than sufficient for dismissal of these appeals.
16. Accordingly, these appeals are hereby dismissed in limine.