SRI SURESH JOSHI,KOLKATA vs. DCIT C.C., JSR

The brief facts of the case are that during the course of assessment proceedings, the Assessing Officer stated that the assessee has made certain expenditure on travelling through its credit card. However, the assessee could not produce the source of the said expenditure/repayment of credit card expenditure. He, therefore, made the impugned addition being expenditure from unexplained sources.

In appeal before the ld. CIT(A), the assessee pleaded that the source of the expenditure was out of two proprietary concerns of the assessee. However, the ld. CIT(A) observed that the withdrawal was by way of cash from the aforesaid proprietary concerns which did not show that the said withdrawn amount was used for payment towards credit card expenditure. He, therefore, confirmed the addition so made by the Assessing Officer.

Before this Tribunal, the ld. counsel for the assessee has submitted that the payment towards credit card expenditure was made out of the partnership/proprietary concerns of the assessee. That the assessee due to misunderstanding of the facts could not produce the relevant details before the lower authorities. That the assessee may be given an opportunity to produce the necessary details to show that the payment towards credit card was made out of known/disclosed sources of the assessee. The ld. counsel has further submitted that even in identical circumstances in the earlier assessment year, the Tribunal has restricted the disallowance to 50%. However, no copy of the earlier order of the Tribunal has been produced before me. The ld. counsel has submitted that the necessary details including the order of the Tribunal will be furnished before the Assessing Officer. He has submitted that the assessee may be given an opportunity to properly present his case before the Assessing Officer.

Considering the above submissions of the Ld. Counsel for the assessee, in my view, the interest of justice will be well-served if, an opportunity is given to the assessee to present his case and furnish the necessary details before the Assessing Officer so as to enable him to arrive at a correct conclusion. Accordingly, the impugned order of the ld. CIT(A) is set aside and the matter is restored to the file of the Assessing Officer with a direction that the Assessing Officer will duly consider the details/evidences etc. that may be furnished by the assessee and thereafter, decide the issue afresh after duly considering the evidences as well as case law, if any, relied upon by the assessee. The appeal of the assessee is treated as allowed for statistical purposes.

In the result, the appeal of the assessee is allowed for statistical purposes.