M.M.KUMAR, J. - (1.) THE assessee has invoked the jurisdiction of this Court under s. 260A of the IT Act, 1961 (for brevity, 'the Act') by 369/Asr/2003, for asst. yr. 1996 -97. The assessee has claimed that the following substantial questions of law would arise for our determination : "(i) Whether on the facts and circumstances of the case, the order of the learned Tribunal is perverse to the extent that on the one hand addition is being made on account of unexplained investments in unaccounted purchases and on the other hand, claim of such purchases is not being allowed while calculating the total income ? (ii) Whether on the facts and circumstances of the case, the learned Tribunal is justified in upholding the addition of Rs. 3,56,231 in the total income of the assessee on the ground that there are unaccounted purchases when the gross profit rate has been applied, on the total sale and no sales have been found made, which are not entered in books of account -
(2.) THE assessee is a partnership firm doing its business of sale/purchase of motor parts at Pathankot. It had filed its income was in addition to salary and interest paid to partners, amounting to Rs. 75,766 + Rs. 35,381, which is assessable directly in the hands of the petitioner. Subsequently, proceedings of assessment under s. 143(2) of the Act were initiated and the AO applied gross profit at the rate of 7.73 per cent as against the declared by the assessee at 6.8 per cent and accordingly, made an addition of Rs. 38,000 in the total income in the final assessment order passed on for on account of some extra stock available with the assessee. No appeal was filed by the assessee against the order of 4,59,401.19 to the taxable income of the assessee being the investment made in unaccounted purchases out of undisclosed sources. Further, the AO added a sum of Rs. 71,081 on account of application of GP rate of 7.75 per cent and initiated proceedings under s. 271(1)(c) of the Act as no vouchers in respect of expense claimed by the assessee were produced.
(3.) THE assessee had agreed to enhance its taxable income by Rs. 10,000 on that issue. that an amount of Rs. 1,84,248 was deleted out of the addition made by the AO on account of unaccounted purchases of Rs. 4,59,401. The Tribunal upheld the additions in respect of unexplained and unaccounted purchases by citing the upheld the additions of Rs. 2,75,153 and Rs. 71,081 on account of working out the profit on unaccounted sales realised from unexplained investments made in the purchases. It was, therefore, held that there was no need to make separate addition on account of disallowance of expenditure and accordingly, the addition of Rs. 10,000 was deleted. After hearing learned counsel, we are of the considered view that no question of law much less a substantial question of law would arise for determination of this Court because the finding of fact that purchases have been made outside the books of account and the sale would also be outside the books of account, has not been shown to be without any basis. The books of account have not been produced and negative stocks have been found by the AO as upheld by the CIT(A) and the Tribunal. These findings cannot be set aside in the appellate jurisdiction under s. 260A of the Act, as it is well - settled position in law. Therefore, we dismiss the appeal and uphold the order passed by the Tribunal.;