Court No. - 3
Case :- INCOME TAX APPEAL No. - 15 of 2021 Appellant :- Sangam Structurals Limited Respondent :- Income Tax Officer Counsel for Appellant :- Pranjal Shukla Counsel for Respondent :- Gaurav Mahajan,Krishna Agarawal
Hon'ble Naheed Ara Moonis,J. Hon'ble Saumitra Dayal Singh,J.
1. Present appeal has been filed under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as the 'Act') against the order of the Income Tax Appellate Tribunal, Allahabad Bench, Allahabad dated 21.12.2017 in Income Tax Appeal No.53/Alld./2015 for the A.Y. 2010-11.
2. The present appeal is being entertained on the following question of law:
"Whether the Tribunal could have set aside the order passed by the CIT (Appeals) and upheld the order of the Assessing Authority without recording any cogent finding as to the genuineness of the credit entries claimed by the assessee?"
3. Having heard Sri Pranjal Shukla, learned counsel for the assessee and Sri Krishna Agarwal, learned counsel for the revenue, we find that though the assessing authority had rejected the claim made by the assessee, the CIT (Appeals) allowed additional evidence to be led and reached conclusion in favour of the assessee.
4. Upon revenue's appeal, the Tribunal has recorded finding that the CIT (Appeals) had not examined the credit worthiness of the lender and had blindly accepted the contention made by the assessee. Second, it has been found that the finding of the Assessing Officer in that regard have not been examined by the CIT (Appeals). Thus, it has been concluded that the assessee had failed to prove the credit worthiness before the "lower authorities". Also, the Tribunal has failed to follow the order passed in the case of assessee in the earlier assessment year on the reasoning that in the context of the Act, each assessment order is a separate unit and the principle of res-judicata does not apply. On such finding a conclusion has been reached by the Tribunal that the assessee has not been able to satisfy the test of Section 68 of the Act.
5. Insofar as the finding of the Tribunal - to not follow the earlier decision is concerned, we do not see any error in the same as no fact or finding has been shown to exist in the earlier assessment order as may have been common to the present assessment year.
6. However, insofar as the other findings are concerned, plainly they may not reach the conclusion drawn by the Tribunal that the assessee had failed to discharge it's burden under Section 68 of the Act. The fact that the Assessing Officer had recorded certain finding or the CIT (Appeals) failed to consider the same or the further fact that the CIT (Appeals) did not record cogent finding on the additional evidence led by the assessee may all be correct yet, the same would only be enough to pass an order of remand but not an order to set aside the appeal order, in entirety, or to uphold the assessment order.
7. To uphold the assessment order, the Tribunal ought to have recorded it's independent findings on the merits of the case after consideration of the evidence that was existing on record. That having not been done, the order passed by the Tribunal cannot be sustained and it is accordingly set aside.
8. In view of the findings recorded by the Tribunal, the matter is remitted to the CIT (Appeals) to decide the assessee's appeal afresh in light of the observations noted above. That exercise may be completed, as expeditiously as possible, without allowing for any undue or long adjournment.
9. The question of law as framed above is answered in negative i.e. in favour of the assessee and against the revenue.
10. Accordingly, the appeal is allowed.
Order Date :- 28.7.2021 S.Chaurasia