Law:

Section:

Section 143 of the Income-tax Act, 1961 - Assessment - Additions to income - Assessment year 1990-91 - Assessee-firm while purchasing copra for sister concern, was deducting an estimated quantity as driage and paying supplier price for net quantity only - In course of assessment proceedings, Assessing Officer found that during relevant previous year though assessee had purchased large quantity of copra, it accounted by way of sales to sister concern lesser quantity - Assessing Officer formed belief that as copra purchased was transferred to sister concern on same day or next day, there was no possibility of any driage and so difference must have been accounted by assessee as bogus purchases and made addition by way of disallowance of such purchase cost - On appeal, Commissioner (Appeals) held that there was no claim of driage as entire quantity purchased by assessee had been transferred to sister concern without even making payment and so there was no justification for addition - On revenue's appeal, Tribunal upheld finding of Assessing Officer that since purchase of balance quantity of copra was not proved to be genuine, there was justification for disallowance of sum claimed as cost for such purchases - Whether any question of law arose from Tribunal's order - Held, no George K. George for the Respondent. JUDGMENT 1. The Income-tax Appellate Tribunal, Cochin Bench has referred the following question of law for decision by this Court :- "Whether on the facts and in the circumstances of the case, the Tribunal is correct in sustaining the additions on the ground that there were bogus purchases against the names of three identifiable persons and also against a number of unidentifiable parties?" The brief facts necessary for decision of this question are as follows: The applicant is a partnership firm carrying on the business of procuring copra for a sister concern by name M/s. M.M. Nagalinga Nadar Sons, Quilon, who had their office in the same premises. While purchasing copra the assessee was deducting an estimated quantity as driage and paying the suppliers the price for the net quantity only. In the course of the assessment proceedings for the assessment year…

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