TaxTMI 
TaxTMI 
2024 (9) TMI 296
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....dity of the jurisdiction assumed by the Assessing Officer to pass the assessment order, more so by disregarding the settled principle that there can be no estoppel against law. B. Whether Hon'ble ITAT erred in law in upholding the addition of undisclosed investment by passing a non speaking order. C. Whether Hon'ble ITAT erred in law in upholding the addition on account of "Addition to fixed assets" when such assets are appearing in the balance sheet. D. Whether the order passed by Hon'ble Tribunal is in accordance with law. 3. The appellant is a partnership firm against whom an assessment for the assessment year 2005-06 was framed by ITO, Ward No.4, Srinagar ["Assessing Officer"] as against the income of Rs. 2,21,148/-. The aforesaid order of assessment of the appellant was framed by the Assessing Officer after selecting the case for scrutiny as per the guidelines laid down in action plan for the year 2006-07 as contained in Clause 2 (q) thereof. The Assessing Officer made an aggregate addition of Rs. 20,28,885/- as unexplained income on the ground that plant and machinery shown in the balance sheet on 31st March, 2004 was to the tune of Rs. 21,58,400....
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....te otherwise invalid jurisdiction. It is, thus, submitted that there could be no estoppel against law. On facts, it was argued that the additions made on account of fixed assets to the tune of Rs. 13,29,206/- and Rs. 6,99,679/-, aggregating to Rs. 20,28,885/-, was not tenable as these amounts were part of the books of accounts and balance sheet and, therefore, could not have been termed as addition to the assets. 7. Per contra, Mr. Suraj Singh Wazir, learned counsel appearing for the revenue, has sought to justify the assessment order and the orders passed by the CIT (A) and ITAT. He would submit that the Assessing Officer as well as both the appellate authorities have taken note of all aspects of the matter and have rightly concluded that there were unexplained additions made to the fixed assets for which the assessee was bound in law to account for. 8. On behalf of the revenue it is submitted that the findings of the learned 1st appellate authority i.e. CIT (A) are on the basis of remand report filed by the Assessing Officer on 16th April, 2008. The remand report was served upon the assessee and he was asked to submit his explanation. The first appellate authority i.e. CIT ....
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....s/cases of Non-Corporate Assessees for scrutiny during the financial year 2006-07. Paragraph No. 2 of the procedural guidelines, in particular its clauses (o) and (q) are relevant for our discussion and are, thus, set out below:- "2. The following categories of cases shall be compulsorily scrutinized:- (a) .......................................... (b) ......................................... (c) ......................................... (d)..................................... (e) ................................ (f) .......................................... (g) ....................................... (h) ........................... (i) ...................................... (j) ........................................... (k) .......................................... (l) ....................................... (m)........................................ (n) ........................................ (o) All cases of contractors whose gross contractual receipts exceed Rs.1 crore in laces other than 60 cities on computer network if total in....
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....was examined by the Assessing Officer and CIT (A). Both the authorities found the explanation not tenable in law and unsupported by any evidence. The Assessing Officer as also both the appellate authorities below rightly treated the addition of Rs. 13,29,206/- as an undisclosed income. 15. The Assessing Officer as also both the appellate forums below have, on facts, found further addition of Rs. 6,99,679/- made during the assessment year in question. Otherwise also, these are question of facts, which have been conclusively determined by the three forums below. 16. The reasoning of CIT (A), which is upheld by the ITAT that the appellant had not raised any objection with regard to the jurisdiction of the Assessing Officer to select his case for scrutiny cannot be found fault with. The appellant, if aggrieved by selection of his case for scrutiny by the Assessing Officer, could have challenged the notice issued under Section 143 (2) of the Act. The appellant did not object to the notice and rather voluntarily participated in the proceedings conducted by the Assessing Officer, which ultimately culminated in framing of the assessment under Section 144 of the Act. 17. As is held....
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...., termed as substantial questions of law, which is prerequisite for entertaining an appeal under Section 260A of the Act. 20. All the three forums have found that the additions to fixed assets made by the appellant-assessee are from undisclosed income and have, therefore, rightly made additions to the income assessable to tax under the Act. 21. Learned counsel for the appellant relied upon some judgments of the Hon'ble Supreme Court and various High Courts to substantiate his argument that pure question of law which arises out of undisputed facts can be raised even at the appellate stage. There is no gainsaying that the aforesaid proposition of law is well settled and does not call for any debate. 22. Mr. Gupta, learned counsel for the appellant, has also relied upon couple of judgments from various High Courts to submit that if a case is picked up for scrutiny in violation of the CBDT circular/guidelines, subsequent assessment made in such case is not sustainable. Reliance was placed by Mr. Aditya Gupta, learned counsel for the appellant, on a Single Bench judgment of the Andhra Pradesh High Court in the case of CIT v. Nayana P. Dedhia dated 27th August, 2004. 23. In t....