| Case ID |
2ae7029d-3905-4f25-a72e-a87633ac330c |
| Body |
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| Case Number |
MISC. APPEAL NO. 58 OF 2002 |
| Decision Date |
Oct 24, 2008 |
| Hearing Date |
|
| Decision |
The Patna High Court upheld the estimation of business income at Rs. 50,000 as made by the Commissioner (Appeals) and affirmed by the Tribunal. The court ruled that the assessment was based on relevant materials including stock and sales data. It determined that the unexplained investment of Rs. 3 lakh was justified, allowing for a margin of error in inventory assessment. However, the Tribunal was not justified in upholding interest under section 234B due to the lack of a specific order from the Assessing Officer. The appeal was partly allowed, modifying the addition to the income but without costs. |
| Summary |
This case involves the assessment of a firm, Vimla Stores, under the Income-tax Act, 1961. The Patna High Court deliberated on several issues including the estimation of business income and unexplained investments. The court found that the estimation of Rs. 50,000 as business income was grounded in relevant evidence, particularly the stock and sales figures during the relevant period. It confirmed that the unexplained investment should be adjusted to Rs. 3 lakh, considering a margin of error in the inventory. However, it ruled against the imposition of interest under section 234B due to the absence of a proper order from the assessing authority. This decision clarifies the standards for income estimation and the treatment of unexplained investments, emphasizing the necessity for material evidence in tax assessments. |
| Court |
Patna High Court
|
| Entities Involved |
Commissioner of Income-tax,
Vimla Stores
|
| Judges |
CHANDRAMAULI KUMAR PRASAD,
SUBASH CHANDRA JHA
|
| Lawyers |
A.K. Rastogi,
Shailendra Kumar,
Ashish Agrawal,
Rishi Raj Sinha
|
| Petitioners |
M/s. Vimla Stores
|
| Respondents |
Commissioner of Income-tax
|
| Citations |
2009 SLD 2023,
(2009) 308 ITR 89,
(2009) 180 TAXMAN 163
|
| Other Citations |
Tej Kumari (Smt.) v. CIT[2001] 247 ITR 210 (Patna),
CIT v. Laxminarain Badridas [1937] 5 ITR 170 (PC),
CIT v. Bansal High Carbons (P.) Ltd.[2007] 165 Taxman 243 (Delhi)
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
145,
69,
234B
|