2016 (11) TMI 210

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.... Judgment of this Court was delivered by Anita Sumanth, J.) This Tax Case (Appeal) challenges an order of the Income Tax Appellate Tribunal dated 16.06.2006 in relation to the block period 1989-99 to 2003-2004 and part of 2004-2005. The following Substantial Question of Law has been admitted for consideration:- Whether the Tribunal is correct in confirming the order(s) of the Lower Aut....

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....gold jewels to the extent of 40118.179 grams. The Appellant agreed to offer to tax the value of the unaccounted purchases/investment as representing his unexplained income. To arrive at the quantum thereof, the Appellant suggested that the peak of the purchases of gold jewellery be adopted at a rate of Rs. 478 per gram. The Appellant thus offered to tax an amount of Rs. 14,34,300/- as unexplained ....

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....ble to have paid the same only by way of a crossed cheque drawn on a Bank or a crossed Bank Draft, failing which 20% thereof would stand disallowed. The objections of the Appellant in this regard were rejected and a disallowance in terms of s.40A(3) effected on the entire purchases of 40118.179 grams of gold at the rate of Rs. 500/- per gram. An amount of Rs. 40,11,818/- being 20% of Rs. 2,00,59,0....

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.... would apply only where expenditure in question has been incurred and claimed in the computation of income. The Supreme Court, in the case of Attar Singh Gurmukh Singh Vs. Income Tax Officer, Ludhiana (191 ITR 667), reiterates this position as well. In the present case, the Tribunal confirms as a finding of fact at para 17 of its order that no expenditure has been incurred except the investment in....