ITO, WARD-1, PATAN vs. PRADIPBHAI DINESHCHANDRA THAKKAR, PATAN

The Revenue has challenged the appeal on the following grounds: 1. The Ld. CIT(A) has erred in law and on facts in deleting the addition of Rs.1,01,67,590/- made by the Assessing Officer on account of unexplained money u/s 69A of the Act in respect of assessee has made transactions of cash deposit. The Ld. CIT(A) failed to appreciate that the assessee had not satisfactorily established the source and genuineness of the cash deposits of Rs. Rs.1,01,67,590/-, and therefore the addition made by the Assessing Officer deserves to be restored. 2. On the facts and in the circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) erred in admitting and relying upon additional evidence such as confirmations, copy of ITR filed under PAN AFLPG5282), Audit report, P&L A/c, balance Sheet, Ledger A/c, bank A/c Statement furnished by the assessee during appellate proceedings without calling for a remand report from the Assessing Officer as mandated under Rule 46A of the Income-tax Rules, 1962. 3. The learned CIT (A) failed to provide adequate opportunity to the Assessing Officer to examine, verify, or rebut the additional evidence produced by the assessee, thereby violating the mandatory procedure prescribed under Rule 46A and principles of natural justice. The order passed by the learned CIT(A), based upon such unverified additional evidence admitted in contravention of Rule 46A, is bad in law, arbitrary, and liable to be set aside. 4. On the facts and in the circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) erred in accepting the contention of the assessee that the impugned transactions were duly reported under another PAN AFLPG5282), without properly appreciating the material facts available on record. 5. The learned CIT(A) failed to appreciate that there was a clear mismatch in the name of the assessee vis-à-vis the alleged PAN AFLPG5282) under which the transactions were claimed to have been reported, and no cogent evidence establishing identity and nexus of the assessee with such PAN was brought on record. 6. The learned CIT(A) further erred in ignoring the fact that the bank account under consideration was not disclosed by the assessee in the return of income filed for the relevant assessment year, thereby rendering the explanation of the assessee unsubstantiated and unverifiable. 7. The learned CIT(A) passed the impugned order without proper verification of the ownership, operation, and disclosure of the bank account under consideration, resulting in an erroneous deletion of the addition made by the Assessing Officer. 8. The appellant craves leave to add, alter, amend, or withdraw any ground of appeal at the time of hearing. 2

In this case, the assessee had not filed return of income and did not comply with the notices u/s 142(1) of the Act and the A.O. completed assessment ex-parte u/s. 144 r.w.s. 147 of the Act. In the assessment, the assessing officer treated the cash deposit of Rs.1,01,67,590/- the assessee’s bank account as the assessee’s income.

In appeal, the Ld. CIT(A) having regard to the submissions filed by the assessee and the documentary evidence submitted in the course of appellate proceedings was satisfied that the assessee had satisfactorily explained both the source and recording of the cash deposits and therefore the addition made by the A.O. could not be sustained. In the course of hearing, no one appeared on behalf of the assessee.

Ld. Sr. D.R. Shri Amit Pratap Singh submitted that the Revenue was aggrieved by the fact that the additional evidence filed by the assessee before the Ld. CIT(A) was not sent to the assessing officer seeking a remand report and this was a violation of Rule 46A. He submitted that the A.O. had never had an opportunity to examine these details and it would be just and proper with the matter is restored to the assessing officer.

We find that the Revenue has taken a specific ground with regard to the additional evidence in ground of appeal no. 3. We also noticed from the impugned order that there is no reference to the evidence being sent to the assessing officer for his comments. We, therefore deem it fit and proper that the matter may be restored to the assessing officer for considering the assessment afresh after taking in to account all the details and evidences submitted by the assessee before the Ld. CIT(A). The matter is accordingly set-aside to the assessing officer.

In the result, the appeal of the Revenue is treated as allowed for statistical purpose.