ITO, PURI WARD, PURI vs. SRI PRASANNA KUMAR PATRA, PURI

Per Shri Pavan Kumar Gadale, JM: This is an appeal filed by the Revenue against the order of CIT(A)- 2, Bhubaneswar, for the assessment years 2011-2012, in the matter of order passed u/s.143(3) of I.T.Act.

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u/s.143(3) of the Act after making additions and assessed total income of Rs.84,23,600/- and passed order dated 06.03.2014. 4. On appeal before the CIT(A), ld. AR argued the grounds and reiterated the submissions made before the AO. Ld. CIT(A) having considered the submissions of the assessee and findings of AO has granted relief in favour of the assessee.

in restricting the addition to the extent of Rs.17,05,527/- as against made

by the AO. The contention of ld. DR that the CIT(A) has not considered

the findings of the AO and only dealt on the submissions made in the appellate proceedings and deleted the addition. In respect of second

ground of appeal, where the CIT(A) has deleted the addition of Rs.14,53,500/- irrespective of the fact that the assessee has not disclosed

the closing balance of savings bank account in his balance sheet though

3 the CIT(A) emphasized on the findings made by the AO in the assessment order but granted relief and prayed for allowing the appeal.

that the CIT(A) has considered all the facts and the remand report and the assessee rejoinder and further based on the genuineness of the transactions, the ld. CIT(A) has granted relief.

submitted by the assessee in respect of bank accounts was forwarded to the AO for his comments and further the AO submitted the remand repot

on 11.05.2016. We found the CIT(A) has referred the remand repot at page 8 & 9 of the order and the assessee was also provided opportunity

to file the rejoinder and accordingly a rejoinder was filed by the assessee

on 27.10.2016 referred at para 5.4.3 which reads as under:-

“5.4.3 As a rejoinder the appellant has filed his submission vide letter dtd.27.10.2016 which is as below: "While preparing for final hearing of the matter, on detailed scrutiny of the Bank Accounts of different Banks, cash shortfall of Rs. 17,05,527/- is dictated as per revised Cash flow statement filed. The appellant in order to by peace of mind and further litigation in the matter; giving an offer with a request to make addition of Rs.17,05,527/- to the returned income."

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peace and avoid litigation agreed for the addition. We found the CIT(A)

having considered the totality of facts, the remand report and rejoinder

has dealt at para 5.4.4. which reads as under :-

“5.4.4 I have closely examined the findings of the assessing officer in the assessment order as well as in the remand report. I have also closely examined the submissions of the appellant including rejoinder. The assessing officer has stated that the closing balance in the HDFC account of Rs.1,92 407/- is taxable. The closing balance has been arrived at by considering opening balance, receipt and payments during the year. Since all the entries for arriving at the closing balance, are explained, there is no justification in holding that the closing balance is undisclosed income of the appellant. The assessing officer has also stated that the fixed deposits of Rs. 26,05,903/- by way of fund transfer in Allahabad Bank are undisclosed income of the appellant. I find that the two fixed deposits of Rs.5,56,216/- and Rs.5,49,687/- are of earlier years and therefore, they cannot be taxed in the year under consideration.”

whereas the CIT(A) having considered the facts and assessee’s

submission with regard to accepting the deficiency in the revised cashflow

statement has dealt at para 5.4.4 referred above, where fixed deposits are of earlier years were excluded and considering the fact of assessee

having accepted the cash deficit of rs.17,05,527/-, the CIT(A) took a reasoned view of restricting the addition to Rs.17,05,527/- which according to us is acceptable. The ld. DR could not bring out any new

material facts in the order of CIT(A) and therefore we are not inclined to interfere with the order of CIT(A) on this ground of appeal and we uphold

the same and dismiss this ground of appeal of Revenue.

5 whereas the assessee has filed the financial details in the appellate

proceedings explaining the nature and source of bank deposits. We found

the CIT(A) has forwarded the submissions to the Assessing Officer and the AO has filed remand report on 11.05.2016 referred at para 5.2 of the CIT(A)’s order. The assessee also filed rejoinder to AO’s remand report and the CIT(A) considered the findings of the AO in the remand report

explained that the assessee has filed the cash flow statement in respect of deposits in Allahabad Bank substantiating that such receipts are in respect of gross sales and receipt of the year but the AO further

mentioned that though the gross receipts of sales have been considered

for bank deposits but the assessee has not disclosed the closing bank

balance in the balance sheet, whereas ld. CIT(A) having considered the facts and findings of the AO in the remand report submitted that the deposits are from the gross sales and deleted the addition.

of closing bank balance, the explanations are not convincing. We

considering the overall aspects and the contentions of ld. DR and material

found that the assessee could not support the stand of non inclusion of closing balance in the balance sheet and we found strength in the submissions of ld. DR in respect of closing balance which was excluded

from the balance sheet and we confirm the addition of closing balance.

6 Accordingly, we modify the order of CIT(A) to the extent of Rs.6,439/- which is to be taxed in the hands of the assessee and this ground of appeal of Revenue is partly allowed.

आदेशानुसार/ BY ORDER,

(Senior Private Secretary) आयकर अपील"य अ"धकरण, कटक / ITAT, Cuttack