2011 (6) TMI 727 - HC - Income Tax

Summary

Issues involved: Appeal by Revenue u/s 260A of the Income Tax Act against ITAT order regarding addition of unexplained cash credit u/s 68 of the Act.

Summary:

Issue 1: Addition of unexplained cash credit u/s 68 of the Income Tax Act

The appeal was filed by the Revenue challenging the ITAT order confirming the deletion of the addition of Rs. 15,00,000 made by the Assessing Officer on account of unexplained cash credit u/s 68 of the Income Tax Act. A survey operation was conducted under Section 133A of the Act in the case of the assessee and its associated companies. The Assessing Officer had added the unexplained cash credit, but the CIT(Appeals) concluded that the transactions were genuine as the deposits were received by Account payee cheques from parties with PANs. The Tribunal upheld the CIT(Appeals) decision, stating that there was no flaw in the reasoning and the issue was based on evidence presented. The High Court found no reason to differ from the lower authorities' reasoning and concluded that no substantial question of law arose for determination, ultimately dismissing the Tax Appeal.

In conclusion, the High Court upheld the decision of the lower authorities regarding the addition of unexplained cash credit u/s 68 of the Income Tax Act, emphasizing the importance of factual evidence in determining the genuineness of transactions and capacity of parties involved.