2013 (10) TMI 1184 - HC - Income Tax

High Court upholds decision on income tax appeal, dismisses for lack of incriminating evidence

The Commissioner Of Income Tax-I Versus Smt. Kanti Gupta

The Commissioner Of Income Tax-I Versus Smt. Kanti Gupta - TMI Issues:Delay in filing appeal, Justification of CIT (A) and ITAT orders, Surrender of undisclosed income, Intermingling of businessesDelay in filing appeal:The judgment addresses the issue of delay in filing the appeal, which was reported to be three days late. The delay was explained in the affidavit supporting the application for condonation of delay, and the court accordingly condoned the delay. The appeal was heard, and Shri Shambhu Chopra represented the income tax department.Justification of CIT (A) and ITAT orders:The appeal under Section 260A of the Income Tax Act, 1961 arose from the order passed by the Income Tax Appellate Tribunal. The substantial questions of law raised in the appeal included the justification of the ITAT's confirmation of the CIT (A) order. The ITAT confirmed the CIT (A) order based on the retraction of the surrender statement by the petitioner on the same day. The court reviewed the orders passed by the Assessing Officer, CIT (A), and ITAT and found that the ITAT rightly deleted the addition made on account of the surrender statement, as no incriminating evidence was collected to support the additions.Surrender of undisclosed income:The judgment also analyzed the surrender of undisclosed income by the assessee during a survey under section 133A of the Act. The questions raised included whether the surrender was voluntary and whether the assessee had genuine tax liability. The court considered the evidence provided by the assessee, the reasons for surrender, and the intermingling of businesses within the family. The ITAT confirmed the additions made on account of profit from undisclosed sales, as the assessee had admitted to unaccounted sales, and the Assessing Officer had adopted a reasonable estimation for the gross profit on these sales.Intermingling of businesses:The judgment discussed the intermingling of businesses between the proprietorship business of the assessee and the businesses run in the names of family members. It was argued that the surrender made by the head of the family was best conversant with the affairs of these businesses. The court reviewed the submissions and observations made by the ITAT regarding the intermingling of businesses and upheld the additions made on account of profit from undisclosed sales.In conclusion, the High Court dismissed the income tax appeal, stating that the findings of fact by the CIT (A) and ITAT regarding the retraction of the surrender statement and lack of incriminating evidence were sufficient reasons to uphold their decisions. The court found no grounds for considering the questions of law raised in the appeal, leading to the dismissal of the appeal.