SHAILESH KUMAR GANDHI,CUTTACK vs. PRINCIPAL CIT, CUTTACK

IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK

BEFORE S/SHRI N.S SAINI, ACCOUNTANT MEMBER AND PAVAN KUMAR GADALE, JUDICIAL MEMBER

ITA No.155/CTK/2018 Assessment Year : 2013-2014

Shailesh Kumar Gandhi, Vs. ITO, Ward 2(4), Cuttack Prop. Gandhi Agencies, Mahatab Road, Cuttack PAN/GIR No.AAZPG 8268 R (Appellant) .. ( Respondent)

Assessee by : None (written submission) Revenue by : Shri Piyush Kolhe, CIT DR

Date of Hearing : 27/09/ 2018 Date of Pronouncement : 28/09/ 2018

O R D E R Per N.S.Saini, AM This is an appeal filed by the assessee against the order of

the Pr. Commissioner of Income Tax, Cuttack dated 30.3.2018

for the assessment year 2013-14.

Commissioner of Income Tax, Cuttack was not was not justified in

holding the order passed by the Assessing Officer is erroneous and

prejudicial to the interest of the revenue.

Income Tax, Cuttack observed that on examination of the balance

P a g e 1 | 6 sheet as at 31.3.2012 of the assessee, it is found that the

assessee has claimed liability under the head “sundry creditors” of

Rs.2,79,699/- in respect of M/s. Lupin Ltd. In response to notice

u/s.133(6) of the IT Act issued by the Assessing Officer during

assessment proceedings, M/s Lupin Ltd replied with a copy of

ledger account confirming the outstanding amount of

Rs.2,44,142/-. Thus, there is excess claim of liability of

Rs.35,557/- by the assessee. On a query to the assessee by the

Assessing Officer, the assessee replied without any supporting

documentary evidence that the difference was continuing from

past years, but failed to explain exactly to which year the

difference was related. In the absence of any satisfactory

explanation for excess claim of liability of Rs.35,557/- in the case

of M/s Lupin Ltd, the Assessing Officer should have added the

same to the total income.

15,00,000/-to his Capital Account during the year under

consideration. During assessment proceedings, it was submitted

that the source of the said capital introduction was Rs.11,00,000/-

out of withdrawals from Savings Account maintained with Bank of

India and balance of Rs.4,00,000/- out of cash available with him.

P a g e 2 | 6 The assessee failed to furnish any details with regard to source of

deposits made in Savings Bank Account and source of cash

available with assessee. In absence of any verifiable documentary

evidence, the addition of capita! of Rs.15,00,000/-remained

unexplained and unverified and the same ought to have been

added to the total income. Therefore, the order of the Assessing

Officer is erroneous and prejudicial to the interest of the Revenue.

Accordingly, he set aside the order framed u/s.143(3) of the Act

dated 24.2.2016 by the Assessing Officer for the assessment year

2013-14 to his file for making fresh assessment after enquiring

into the excess liability of Rs.35,556/- in the case of M/s. Lupin

Ltd., and fresh introduction of capital of Rs.15 lakhs.

before us.

passed u/s.143(3) of the Act on 24.2.2016 there is no discussion

about two issues regarding excess liability in the name of M/s.

Lupin Ltd., of Rs.35,556/- and introduction of capital of Rs.15

lakhs in the assessment order but the Assessing Officer after

making enquiries and being fully satisfied after the examination of

P a g e 3 | 6 the issues, has not made addition to the income of the assessee.

In these circumstances, the order of the Pr. Commissioner of

Income Tax setting aside the order of the Assessing Officer is bad

in law.

Commissioner of Income Tax.

lower authorities and materials available on record. In the instant

case, the undisputed facts of the case are that the Pr.

Commissioner of Income Tax, Cuttack observed that the assessee

has shown excess liability of Rs.35,556/- in respect of M/s. Lupin

Ltd., as verified from the confirmation of account by Lupin Ltd.

Further, there was fresh capital introduction of Rs.15 lakhs by the

assessee, the source of which, was Rs.11 lakhs out of withdrawal

from Saving account with Bank of India and Rs.4 lakhs out of cash

available with him. He observed that in respect of confirmation by

Lupin Ltd., at a lower figure by Rs.35,557/-, of amount payable to

it by the assessee, the Assessing Officer has not made addition of

Rs.35,557/- to the income of the assessee as excess liability

shown in the balance sheet. He further observed that the

P a g e 4 | 6 Assessing Officer has not verified the source of deposit of Rs.11

lakhs in the Saving Account with Bank of India of the assessee

and availability of Rs.4 lakhs and without verifying the same, has

accepted introduction of capital of Rs.15 lakhs.

discussion in the assessment order by the Assessing Officer on

these two issues, the Assessing Officer after verification and being

satisfied with the explanation of the assessee and evidence filed

before him, has not made any addition to the income of the

assessee and, therefore, the order of the Pr. Commissioner of

Income Tax passed u/s.263 setting aside the order of the

Assessing Officer and restoring the matter back to the file of the

Assessing Officer for fresh adjudication as bad in law.

not filed questionnaire issued by the Assessing Officer u/s.143(2)

and section 142(1) of the Act and what was the reply of the

assessee to the same. Thus, in absence of these evidences, we

are unable to adjudicate the issue completely. Therefore, we find

no good reason to interfere with the order of the Pr. Commissioner

of Income Tax setting aside the order of the Assessing Officer

P a g e 5 | 6 passed u/s.143(3) of the Act dated 24.2.2016 and restoring the

matter back to the file of the Assessing Officer for adjudicating the

issues afresh. Thus, the ground of appeal of the assessee is

dismissed.

Order pronounced on 28/09/2018. Sd/- sd/- (Pavan Kumar Gadale) (N.S Saini) JUDICIALMEMBER ACCOUNTANT MEMBER Cuttack; Dated 28/09/2018 B.K.Parida, SPS Copy of the Order forwarded to : 1. The appellant :Shailesh Kumar Gandhi, Prop. Gandhi Agencies, Mahatab Road, Cuttack 2. The Respondent. ITO, Ward 2(4), Cuttack 3. The CIT(A)- 4. Pr.CIT- Cuttack 5. DR, ITAT, Cuttack By order 6. Guard file. //True Copy// Sr. Pvt. Secretary, ITAT, Cuttack

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