:1: bgp bgp bgp IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION INCOME INCOME INCOME TAX APPEAL NO.231 OF 2006 TAX APPEAL NO.231 OF 2006 TAX APPEAL NO.231 OF 2006 Kishan Kumar Shyam Sunder Goyal ..Appellant Vs. Additional Commissioner of Income Tax ..Respondent Mr.K.R.Bhujle for the Appellant. None for the Respondent. CORAM CORAM CORAM :- DR.S.RADHAKRISHNAN & :- DR.S.RADHAKRISHNAN & :- DR.S.RADHAKRISHNAN & V.C.DAGA, V.C.DAGA, V.C.DAGA, JJ. JJ. JJ. DATE DATE DATE : 12TH NOVEMBER, 2008 : 12TH NOVEMBER, 2008 : 12TH NOVEMBER, 2008 P.C. P.C. P.C. . Heard the learned Counsel for the Appellant. In the above, the Appellant is seeking to raise the following substantial questions of law: 4.1) Whether, on the facts and in the circumstances of the case, the Hon’ble Tribunal erred in setting aside the order of the learned CIT(A) and restoring the order of the learned Assessing Officer? 4.2) Whether, on the facts and in the circumstances of the case, the Hon’ble Tribunal erred in confirming the disallowance of loss of Rs.16,69,644/- merely by holding that the loss claimed by the assessee is not the result of the normal trading activity? 2. We have perused the order dated 31st January, 2006 passed by the Income Tax Appellate Tribunal. The Tribunal had set aside the order of the Commissioner of Income Tax (A) and had restored the same before the Assessing Officer. We have also perused the original assessment order, wherein the Assessing Officer has categorically given his findings that: The above explanation of the Assessee is very general and is not convincing to me at least :2: with regard to the losses incurred in the transactions with M/s.Malvika Steel Ltd. and M/s.Kothari Steels Syndicate. The assessee is required to prove the genuineness of loss which he failed to do. As far as purchases and sale transactions with M/s.Malvika Steel Ltd. and M/s.Kothari Steels Syndicate respectively, it is observed that material had not been either received or delivered. No documents in support of movement of material could be produced during the hearing. This fact had been mentioned in the order sheet. No transport bills were either produced later. No material has been produced by the assessee to prove the fluctuation in market conditions. If this were to be the fact, losses should have been incurred on other purchase and sale transactions also. The purchase bills and the corresponding sale bills in respect of the transactions with the above two parties show that the gap between the alleged purchases and corresponding sales is not more than one week to three weeks. There are instances where the gap between purchase and sale is only 5 to 6 days. Further, there is no reason why the purchases made from M/s.Malvika Steel Ltd. should always be sold to M/s.Kothari Steels Syndicate. The assessee maintains stocks at any point of time and no explanation as to why the material purchased was not kept as stock and why it should be immediately sold at loss. Therefore, the loss of Rs.16,69,644/- incurred by the assessee cannot be considered as a genuine loss and this loss is only loss created through book entries to suppress the overall profits. Under the circumstances, I disallow the loss of Rs.16,69,644/- incurred on the transactions with the above referred two parties. As the assessee suppressed the profits to this extent and thereby concealed the particulars of income, penalty proceedings u/s.271(1)(c) of the I.T. Act,1961. 3. In view of the aforesaid findings of facts, we do not find any substantial question of law involved in the above. Hence, the Appeal stands dismissed. (V.C.DAGA,J.) (V.C.DAGA,J.) (V.C.DAGA,J.) (DR.S.RADHAKRISHNAN,J.) (DR.S.RADHAKRISHNAN,J.) (DR.S.RADHAKRISHNAN,J.)