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2017 (3) TMI 898 - HC - Income TaxApplication under Section 256 (1) rejected - admitting additional evidence - payments as per information submitted by the assessee - peak deficit addition - Held that:- The Tribunal referred to each of the questions separately and gave convincing reasons for refusing to refer the same. The Tribunal held that though it was the case of the Department in the appeal before the Tribunal that the assessee had tendered additional evidence and no opportunity was granted to the Department to refute the same, the Tribunal found as a matter of fact that no additional evidence was admitted before the Tribunal in the appeal filed by the assessee. The Tribunal recorded that the Counsel for the Department was not able to demonstrate before the Tribunal while hearing the application under Section 256 (1) of the Act that any additional evidence was considered by the Tribunal. In regard to the other questions Tribunal held that on a scrutiny of the Note Book, D14 it was apparent that all the entries mentioned therein did not pertain to the receipts and several entries pertain to expenditure and therefore, it was rightly observed by the Tribunal that it was dangerous to accept the statement of the Managing Director of the Company that was initially made on 4.8.1995. The Tribunal held that it could not be said after considering the Note Book, D14 that there was a contradiction in the statement made by the Managing Director as the subsequent statement of the Managing Director was an explanatory statement that was substantiated by the Managing Director, on the basis of the Note Book, D14. The Tribunal has, in the order dated 21.03.1997 recorded reasons for reducing the peak deficit and quantifying the undisclosed income by referring to the material available before the Tribunal. In the order under Section 256 (1) while refusing to refer question no.4, the items from the peak deficit of ₹ 55,52,042/are recorded and it is observed that the Tribunal had given sufficient reasons for reducing the peak deficit. While refusing to refer the questions that were sought to be referred, after recording convincing reasons it is observed by the Tribunal that no question of law would arise for being referred to the High Court. We find on a reading of the orders of the Tribunal, dated 21.03.1997 and 10.09.1997 that the order of the Tribunal, dated 21.03.1997 is based on the material on record and no legal principles are applied, that would give rise to a question of law that would require a reference being made to the High Court. We find that the order of the Tribunal dismissing the application under Section 256 (1) of the Act is just and proper and the jurisdiction under Section 256 (2) of the Act is not exercisable in the facts of the case. - Decided against revenue
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