Commissioner of Income Tax vs M/s. Raj Homes Pvt. Ltd.

Heard on the question of admission. This is an appeal by appellant u/s 260A of the Income Tax Act, 1961 challenging the concurrent orders passed by the Commissioner of Income Tax (Appeals) and Appellate Tribunal, Indore.

The respondent assessee is a private limited company and is engaged in development of land, construction of flats, bungalows, shops etc. and there sale. For the financial year 2002-03 return was filed by the assessee 03/02/2003 declaring total income at Rs. 73,18,470.

It is seen that on 27/02/2002 in the group of establishment of the assessee, search and seizure operation u/s 132(1) was carried out and the case was taken up in scrutiny. The Assessing Officer completed the assessment u/s 143(3) on 18/03/2005 and a total income of Rs. 2,04.27,139/- was returned against the declared income of Rs. 73,18,470/- indicated by the assessee. The order was passed by the Assessing Officer as Annexure A/1. The respondent assessee aggrieved thereof filed an appeal before the Commissioner Income Tax (Appeals), appeal was partly allowed vide order Annexure A/2 and therefore, department filed an appeal before the Tribunal and the Tribunal having refused to interfere, this appeal has been filed. It is said that the appellate authority has committed an error in deleting an addition of Rs. 1,10,17,175/- made by the Assessing Authority on account of substantive addition for the block period 01/04/1995 to 27/02/2002. It is further stated that in deleting further addition of Rs. 19,91,494/- as ordered by the Assessing Authority, the Appellate Authority has committed an error. It is stated that the Appellate Authority interfered into the matter mainly because reasons for invoking the provision u/s 145 was not indicated and further substantive addition made by the Assessing Officer was found to be unsustainable.

Even though Shri Sanjay Lal, learned counsel for appellant tried to emphasis that in deleting the addition made by the Assessing Officer an error has been committed and therefore, the substantial question as indicated in this appeal arise for consideration but on going through the records and on analyzing the reasons given by the authorities, it is seen that the Assessing Officer has made an substantive addition of Rs. 1,10,17,175/-for the block period 01/04/2001 to 27/02/2002 u/s 158(B)(B) as protective addition. It is found that u/s 158(B)(B) such an addition is not permissible. It is also found that similar addition was with regard to the same assessee is already quashed by an order dated 29/04/2005. It was found that huge addition of one crore has been made on vague and presumptive manner without there being any substantive basis and material available on record. It is also found that u/s 145 exercise of powers without disclosing cogent reason is unsustainable. The tribunal has also re-appreciated all these facts and have come to the conclusion that addition of more than one crore rupees was deleted by the Commissioner Appeals under similar circumstances in the previous years also. Taking into consideration all these circumstances Tribunal has also refused to interfere. The concurrent orders with regard to assessment made by the Authority have been passed by the Commissioner Appeals and the Tribunal and we see no substantial question of law involved warranting interference in this appeal, the orders concurrent in nature passed by the Authorities are based on the assessment procedure followed by assessing authority and the reasons given by the Appellate Authorities cannot be termed as perverse and erroneous warranting interference into the matter. Accordingly, finding no ground, appeal is dismissed at this stage as no substantial question of law arise for consideration.