Case Law Details
P.V. Thomas Vs ITO (Kerala High Court)
Introduction: The recent verdict of the Kerala High Court in the case of P.V. Thomas Vs ITO (Income Tax Officer) has significant implications for income tax assessments. Dated 02.08.2022, the judgment addresses the appeal (ITA No.22/COCH/2022) related to the assessment year 2015-2016 under the Income Tax Act.
Detailed Analysis: The appellant, a dealer in used cars, filed a return of income in December 2015, declaring a total income of Rs.13,54,160/-. However, the assessment under Section 143 (3) of the Income Tax Act raised concerns. The authorities disallowed a cash payment of Rs.11,59,000/- under Section 40A (3). The appellant, while filing an appeal, seemingly agreed to this addition, leading the First Appellate Authority to dismiss the grievance, stating it was an agreed order.
Despite the agreement, the appellant pursued a further appeal, yet the Tribunal upheld the decision of the First Appellate Authority. The crux of the matter lies in the appellant’s admission to the addition under Section 40A (3) without presenting any material to contest its validity.
In the absence of supporting evidence against the addition, the Kerala High Court found no grounds for interference. The judgment emphasizes the importance of substantiating claims and presenting material evidence during the appeals process. The decision reaffirms the authority of the Income Tax Act in disallowing cash payments under specific sections, protecting the integrity of tax assessments.
Conclusion: Conclusively, the Income Tax Appeal filed by the appellant stands dismissed by the Kerala High Court. The judgment serves as a reminder of the significance of providing material evidence to support claims during the appeals process. Taxpayers and professionals alike should take note of the implications of this decision for future assessments, reinforcing the need for diligence and transparency in income tax matters.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
This Income Tax Appeal impugns the order dated 02.08.2022 of the Income Tax Appellate Tribunal, Cochin Bench, Cochin in ITA No.22/COCH/2022, pertaining to the assessment year 2015-2016 under the Income Tax Act.
2. Shorn of unnecessary details, the brief facts necessary for the disposal of this Income Tax Appeal are that the appellant, who is a dealer in used cars, had filed a return of income on 12.12.2015 for the assessment year 2015-2016 declaring a total income of Rs.13,54,160/-. The assessment under Section 143 (3) of the Income Tax Act was completed by disallowing the cash payment of an amount of Rs.11,59,000/- under Section 40A (3) of the Income Tax Act. Aggrieved by the assessment order, the appellant filed an appeal before the First Appellate Authority, who noticed that the appellant had actually agreed to the addition of Rs.11,59,000/- under Section 40A (3), and hence he could not be said to be aggrieved by the assessment order since it was an agreed order. In a further appeal preferred by the appellant, the Tribunal also agreed with the First Appellate Authority. It is against the said order of the Appellate Tribunal dismissing the appeal of the appellant, that he has now approached this Court through the present Income Tax Appeal.
3. We have heard Sri. Harisankar V. Menon, the learned counsel for the appellant and Sri .Jose Joseph the learned Standing counsel for the Income Tax Department.
4. On a consideration of the rival submissions and taking note of the fact that the appellant had admitted the addition under Section 40A (3) of the Income Tax Act and further, had not produced any material before any of the Appellate Authorities to suggest that the addition was not warranted, the finding of the Tribunal based on the admission of the appellant does not warrant any interference in this appeal.
Resultantly, this Income Tax Appeal fails and is accordingly dismissed.
