SANJITHA REDDY ,BANGALORE vs. INCOME TAX OFFICER, WARD-4(2)(1), BANGALORE
Income Tax Appellate Tribunal, ‘B’ BENCH : BANGALORE
Before: SHRI LAXMI PRASAD SAHU & SHRI SOUNDARARAJAN K.Assessment Year : 2016-17
PER SOUNDARARAJAN K., JUDICIAL MEMBER
This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 13/05/2025 in respect of the A.Y. 2016-17 and raised the following grounds:
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Grounds of Appeal
Tax effect relating to each
Ground of appeal (see note below)
1. The impugned Order u/s. 250 of the Act dated: 13-05-2025 passed by the Ld. CIT(A), NFAC, Delhi is opposed to law, facts and circumstances of the case.
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2. The Ld.CIT(A) NFAC has erred in confirming the Addition made by the AO u/s 69A of the Act amounting to Rs.71,23,875/- without appreciating the facts and circumstances of the Case.
Rs.63,17,522/-
3. The Ld. CIT(A) NFAC has erred in holding that the Appellant has not produced any documentary evidence in support of the source of Cash deposit without appreciating the facts and circumstances of the Case that the assessee has furnished the explanation supported by the Affidavits of the persons who contributed the money to the assessee as mentioned in para 11 of the appellate order.
Rs.63,17,522/-
4. The Ld. CIT(A) NFAC has erred in not considering the explanation and the affidavits filed before the AO from whom report was not received as called for by the Ld. CIT(A) as mentioned in para 3 of the appellate order in support of cash of Rs. 71,23,875/-
Rs.63,17,522/-
5. Without prejudice to the ground no.
2 to 4 it is urged that the Ld. CIT(A) has not appreciated the fact that the Assessment proceedings initiated were challenged on the ground of Juri iction.
Rs.63,17,522/-
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6. The Ld. CIT(A) has erred in holding that the AO has issued a Notice u/s 148 of the Act dated 24-03-2023
without appreciating the fact that the said notice was invalid and without juri iction in view of Faceless Assessment Scheme u/s 144B of the Act.
Rs.63,17,522/-
7. The Ld.
CIT(A) has erred in dismissing the Ground no. 2 urged relating to the invalidity of Notice u/s 148 of the Act, merely on the ground that approval was obtained from the competent authority without appreciating the Fact that the approval by itself was not justifiable in view of Faceless
Assessment Scheme u/s 144B of the Act.
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9. The Ld. CIT(A) ought to have set aside the ex parte assessment order dated
25-03-2024
which was completed to save the limitation of time, without invoking amended provision of Sec 251(1) of the Act.
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10. The Appellant craves leave to add, alter, amend and delete any of the grounds at the time of hearing.
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Total Tax Effect
Rs. 63,17,522/-
The brief facts of the case are that the assessee is an individual and she had not filed her return of income and the AO based on the information received that she had purchased a property, had issued a notice u/s. 148. The assessee had not filed any return of income pursuant to the notice issued u/s. 148 of the act and therefore notices u/s. 142(1) were issued. The assessee had not furnished her response but only sought for time to furnish her response. The AO by issuing notice u/s. 133(6) of the Act to the seller, got the sale deed copy and on that basis, the purchase consideration was arrived at Rs. 66,82,500/- and the registration charges of Rs. 4,41,375/-. The AO also found that the entire sale consideration was paid
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in cash and since no explanations were offered by the assessee, the AO had treated the said amount as unexplained investment u/s. 69A of the Act and to that effect, a show cause notice was issued. Finally, the assessee filed her reply to the said show cause notice and gave the source for the said purchase consideration and also enclosed the affidavits obtained from her relatives that most of the amounts were received by her as gifts from her relatives. The assessee also relied on the first proviso to section 56(2)(x)(c) of the Act and objected that the gifts received from the relatives could not be treated as income. The AO had not accepted the affidavits filed by the assessee since their creditworthiness were not proved. As against the said order, the assessee filed an appeal before the Ld.CIT(A) and contended that the 148A notice issued by the JAO is not correct, after the introduction of the faceless assessment scheme. The assessee also contended that the source for the said purchases were explained by filing affidavits from the relatives who had given the amount for purchasing the property but the AO had not considered the same and also not verified the said facts and therefore the addition made u/s. 69A is not correct. The Ld.CIT(A) had not accepted the legal grounds raised by the assessee and confirmed the addition made u/s. 69A of the Act.
As against the said order, the present appeal has been filed before this Tribunal.
At the time of hearing, the Ld.AR submitted that the assessee had discharged her onus that the cash for the said purchases were received from her relatives and the AO without verifying the genuineness of the deponents by summoning the said deponents u/s. 133(6) of the Act but made the addition u/s. 69A of the Act which is not correct. The Ld.AR further submitted that the assessee had discharged her duty by showing sources for the receipt of the said cash from their relatives and therefore without furnishing any contra evidences, the AO could not make the addition u/s. 69A of the Act.
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5. The Ld.DR relied on the orders of the lower authorities.
We have heard the arguments of both sides and perused the materials available on record.
In the present case, the purchase of property was not denied by the assessee but the AO had alleged that the source for the sale consideration paid by the assessee was not properly explained. We find from the assessment order that the assessee had explained the source that her relatives gifted and to that effect also filed affidavits from the said donors. As rightly contended by the Ld.AR that the AO also failed to make enquiries to ascertain the creditworthiness of the donors. When the assessee had prima facie discharged her duty by filing the affidavits from the said relatives, the AO before making the assessment could have issued the summons u/s. 133(6) of the Act and verified about the creditworthiness of the said donors so that the issue could be settled.
We, therefore deem it appropriate to remit this issue to the file of the AO for making a detailed enquiry about the genuineness of the donors and thereafter proceed the assessment in accordance with law. We also make it clear that before passing any adverse orders by the AO, proper opportunity of hearing should also be given to the assessee.
In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open court on 18th December, 2025. (LAXMI PRASAD SAHU) Judicial Member
Bangalore,
Dated, the 18th December, 2025. /MS /
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Copy to:
1. Appellant
Respondent 3. CIT
DR, ITAT, Bangalore
Guard file
CIT(A)
By order