C. PACKIRISAMY Vs. ASSISTANT COMMISSIONER OF INCOME-TAX

JUDGEMENT

(1.) THIS tax case is directed against the order dated June 25, 2008, in I.T.A. No. 1288/2006 on the file of the Income -tax Appellate Tribunal, Chennai, against the order of the Commissioner of Income -tax (Appeals), Tiruchi, dated February 27, 2006, in I.T.A. 110/05 -06/2077 and the assessment order of the Income -tax Officer, Ward 1 (2), Nagapattinam, dated March 28, 2005 in assessment number and year GI: 4227P/2002 -03.

(2.) THE following are the substantial questions of law raised for our consideration:

(3.) THE Commissioner of Income -tax (Appeals) opined that the estimate cannot be based an hypothetical situation and on comparison of sales and the probable profit, the addition made by the Assessing Officer was reduced to Rs. 1,25,000. With regard to the disallowance of opening capital the Commissioner (Appeals) found that the assessee filed a bunch of returns for the year 1996 -97 to 2001 -02 only on October 29, 2002 and in those returns, he has shown income varying from Rs. 41,000 to Rs. 53,500. The Commissioner of Income -tax was of the view that it was not possible for the appellant to have a capital balance of Rs. 5,73,960 and, accordingly, a factual finding was arrived at by the Commissioner (Appeals) that it was not possible for the assessee to accumulate the capital to the extent shown by him. The Commissioner (Appeals) also found that the assessee failed to prove the source of opening capital and as to how it accumulated for the years. Accordingly, the Commissioner (Appeals) fully endorsed the view of the Assessing Officer with regard to the accumulation of capital. Aggrieved by the said order, the assessee preferred an appeal before the Tribunal.