Law: Income Tax Act, 1961

Section: 139(8),215,246

(a) Income-tax----Appeal---Interest---Levy of interest is part of assessment---Assessee entitled to dispute levy on ground it was not leviable at all---Indian Income Tax Act, 1961, Ss.139(8), 215 & 246. (b) Income-tax--- ----Reference---Assessment---Additions to closing stock on ground of under valuation ---Assessees explanation that entries duplicated not substantiated---Finding of Tribunal and Authorities that inventory properly taken---Is finding of fact---Order of Tribunal confirming addition justified--¬Indian Income Tax Act, 1961. On a reference of the question whether the Tribunal was justified in confirming the addition of Rs.1,71,531 as representing understatement in the closing stock, rejecting the explanation furnished by the assessee to the effect that the stock inventory prepared by him was done in a hurry on a single day when there were sales and the said inventory contained a lot of mistakes and duplication: Held, that it was the definite case of the Department that the contentions of the assessee that there were duplicate entries in the closing stock entries were totally in tenable. The claim of the assessee that there was duplication in the closing stock inventory in respect of several items remained unsubstantiated. As a matter of fact, it was found by the authorities below that the stock was taken very carefully and. meticulously measuring each bale and each piece separately thereby obviating any possibility of duplication. The findings entered by the statutory authorities on this point were essentially findings of fact, neither perverse nor based on mere conjectures or surmises. The order of the Tribunal was, therefore, justified. Inasmuch as the levy of interest under sections 139(8) and 215 of the Income Tax Act, 1961, is a part of the process of assessment, it is open to an assessee to dispute the levy in appeal provided he limits himself to the ground that he is not liable to the levy at all. Central Provinces and Manganese Ore-Co. Ltd. v. CIT (1986) 160 ITR 961 (SC) fol. JUDGMENT K. NARAYANA KURUP, J.---This I.T.R. arises out of the reference made by the Income-tax Appellate Tribunal, Cochin Bench, in R.A.. No.8 (Coch) of 1981…

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