Allahabad H.C : Whether, on the facts and in the circumstances of the case, the Tribunal had any valid material in reversing the CIT of Income-tax’s order and sustaining the addition of Rs. 1,18,799 as income of the assessee- company assessable for the assessment year under reference ?

High Court Of Allahabad

Motilal Padampat Udyog Ltd. vs. CIT

Sections 256, 256(2)

B.P. Jeevan Reddy, C.J. & S.C. Verma, J.

IT Appln. No. 88 of 1990

24th August, 1990

Counsel Appeared

Roy, for the Petitioner : B.N. Rath, for the Respondent

P. JEEVAN REEDY, C. J.:

By this application, the assessee is requesting this Court to state the following five questions under s. 256(2) of the IT Act, 1961 :

“(1) Whether, on the facts and in the circumstances of the case, the Tribunal had any valid material in reversing the CIT of Income-tax’s order and sustaining the addition of Rs. 1,18,799 as income of the assessee- company assessable for the assessment year under reference ?

(2) Whether, on the facts and in the circumstances of the case, there was any legal basis for the Tribunal to come to the conclusion that the assessee-company had been paid Rs. 1,18,799 as on money by amount (sic) is to be assessed in the hands of the company as its income ?

(3) Whether, on the facts and in the circumstances of the case, the Tribunal was, correct in law in refusing the assessee’s right to cross -examine the persons whose statements were relied on for making the addition of Rs. 1,18,799 and in not following the principles of natural justice and the Supreme Court judgment in Kishinchand Chellaram vs. CIT (1980) 19 CTR (SC) 360 : (1980) 125 ITR 713 ?

(4) Whether the Tribunal’s decision confirming the addition of Rs. 1,18,799 is bad in law and vitiated by irrelevant considerations and reliance upon extraneous material which was disowned and denied even by the persons from whom the same was alleged to have been obtained by the Department ?

(5) Whether, on the facts and in the circumstances of the case, the Tribunal’s decision confirming the addition of Rs. 1,18,799 is vitiated by failure to consider the relevant facts and material and consideration of irrelevant facts and placing reliance on conjectures and surmises ?”

After hearing counsel for both the parties, we are of the opinion that question No. 3 does arise as a question of law from the order of the Tribunal which ought to be referred for the opinion of this Court. It is not necessary to refer the other questions because all the five questions relate essentially to one question, namely, the validity of the addition of Rs. 1,18,799.

Accordingly, the income-tax application is allowed in part. Question No. 3 shall be stated by the Tribunal under s. 256(2) of the IT Act. In respect of other questions, the income- tax application is dismissed.

No costs.

[Citation : 187 ITR 543]

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