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TMI Blog2017 (3) TMI 898X X X X Extracts X X X X X X X X Extracts X X X X ..... ances of the case, the Tribunal was justified in law in accepting the payments as per information submitted by the assessee without identifying the parties ? (3) Whether on the facts and in the circumstances of the case, the ITAT was justified in law in giving weightage to the statement of Shri Adil Bapuna recorded on 21-8-95 over that recorded on 4/8/95 which substantially changes the character of entries of Note Book D14 ? (4) Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in reducing the peak deficit of Rs. 55,52,042/worked out by the Assessing Officer by Rs. 33,48,560/? (5) Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in working out a peak deficit on the basis of total receipts and total payments instead of on a daytoday basis ? (6) Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in quantifying the undisclosed income on grounds/arguments not fully supported by valid evidence ?" The following facts give rise to the application : The respondent - assessee is a company engaged in the manufacture of spirit, alcohol etc. On 2.8.199 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer made the addition of Rs. 10,56,755/towards the total investment in the immovable property and the addition of Rs. 15,91,589/as unexplained money of the assessee-company. After making the aforesaid additions, the Assessing Officer computed the amount of tax payable by the assessee at Rs. 3,78,83,295/. Being aggrieved by the order of the Assessing Officer, the assessee filed an appeal before the Income Tax Appellate Tribunal. The Income Tax Appellate Tribunal by the order dated 21.3.1997 partly allowed the appeal of the assessee and held that the Assessing Officer was not justified in working out the undisclosed income at Rs. 6,31,38,825/and the assessee was also not justified in offering the undisclosed income of Rs. 17,00,000/. The Tribunal determined the undisclosed income at Rs. 61,20,114/. While holding so, the Tribunal considered the entire material on record and went through each and every entry to satisfy itself about the position of transactions explained by the assessee. After the Tribunal decided the appeal on 21.3.1997, the Department filed an application under Section 256 (1) of the Act for referring the aforestated six questions to the High Court for a decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee vide order dated 21.3.1997 the Tribunal had not applied any legal principles or law. It is submitted that on the basis of the material evidence and the factual aspects of the matter, the Tribunal had decided the appeal of the assessee by the order dated 21.3.1997. It is submitted that while deciding the application under Section 256 (1) of the Act, the Tribunal has considered the order of the Tribunal dated 21.3.1997 in detail and has recorded convincing reasons for refusing to refer the questions that were sought to be referred by the Department to the High Court under Section 256 (1) of the Act. The learned Counsel for the assessee-company took this Court through the order of the Tribunal dated 21.3.1997 to point out that the findings of the Tribunal in the appeal filed by the assessee are based fully on facts, specially on a perusal of the Note Book, D14 and each and every entry made therein. The learned Counsel sought for the dismissal of this application. On a reading of the orders of the Tribunal, dated 21.3.1997 and 10.9.1997, it appears that it is not necessary to invoke the jurisdiction under Section 256 (2) of the Act. The Assessing Officer had passed the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame were not only the receipts but also the expenditure. While holding so, the Tribunal found that the statement of Shri Bohre that Annexure-A represented receipts, Annexure- - B represented expenditure, Annexure-C represented transactions recorded in the books of account and Annexure- - D represented transactions which were neither trading receipts nor trading payments was substantially correct. After recording the aforesaid findings of facts, the Tribunal proceeded to decide the question as to what would be the quantum of addition to be made in respect of the suppressed receipts. By relying on the judgment of the Hon'ble Supreme Court, the Tribunal held that it was not proper to treat the entire receipts as the income of the assessee. The Tribunal then considered the peak deficit, cash balance in the books of account of the company besides the sale proceeds as also the offer of Rs. 17,00,000/by the assessee as undisclosed income and came to the conclusion that the undisclosed income of the assessee would be Rs. 61,20,114/. After minutely perusing the order of the Tribunal dated 21.3.1997, the Tribunal while rejecting the application under Section 256 (1) of the Act, dated 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal 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. The judgment reported in (2015) 375 ITR 373 (Commissioner of Income Tax-II Versus Jansampark Advertising & Marketing (P) Limited) and relied on by the counsel for the Department only reiterates the well established legal position that the Commissioner (Appeals) and the Tribunal are fact finding authorities and if the Assessing Officer fails to discharge his functions properly, there is an obligation on the said authorities to conduct appropriate enquiry on facts. We are afraid that the said decision is not relevant for the purpose of deciding this application under Section 256 (2) of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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