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Facts
The assessee declared total income of Rs. 27,57,060 for AY 2017-18. The Assessing Officer (AO) made additions for unexplained cash deposits of Rs. 15,83,000 and registration charges for property of Rs. 3,15,100. The CIT(A) confirmed these additions.
Held
The Tribunal held that the additional evidence filed by the assessee, including gift deeds, loan documents, and bank statements, needs to be verified by the Assessing Officer. The matter was set aside for re-adjudication.
Key Issues
Whether the additional evidence submitted by the assessee for cash deposits and property registration charges is admissible and requires fresh verification by the AO.
Sections Cited
68
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, Hyderabad ‘ SM- B ‘ Bench, Hyderabad
Before: Shri Vijay Pal Rao, Vice-Shri Manjunatha, G.
Per Vijay Pal Rao, Vice President
This appeal by the assessee is directed against the order dated, 26/11/2024 of the learned CIT (A)-NFAC Delhi, relating to A.Y.2017-18.
The assessee has raised the following grounds of appeal:
3. The assessee is an individual and derives income from salary. The assessee filed his return of income for the year under consideration on 3/8/2017 declaring total income of Rs.27,57,060/-. The case of the assessee was selected for scrutiny through CASS. The Assessing Officer made inter alia addition on account of unexplained cash deposits of Rs.15,83,000/- u/s 68 of the I.T. Act, 1961 as well as unexplained investment in property
Page 2 of 6 being the registration charges of Rs.3,15,100/- which are the subject matter of this appeal.
The assessee challenged the action of the Assessing Officer before the learned CIT (A) but could not succeed.
At the time of hearing, the learned AR of the assessee has submitted that due to the nature of the assessee’s employment being a Pilot in an Airline, the assessee could not produce the relevant supporting evidence and details before the authorities below in support of the source of deposits made in the bank account as well as the registration charges for purchase of house property. The learned AR has submitted that the assessee has now filed an application for admission of additional evidence in support of the source of deposit in the bank account as well as the expenditure on account of registration charges of the house property. Thus, the learned AR has submitted that the additional evidence filed by the assessee may be admitted in support of the claim of the assessee to explain the source of fund with the assessee. He has referred to the additional evidence sought to be filed by the assessee in the paper book from Page No.1 to 17 comprising of gift deed executed by the Father of the assessee who is a retired govt. servant having sufficient funds and proof of withdrawal of the same as per the bank account statement along with other loan taken by the assessee as well as the fund from the mother. Thus, the learned AR has submitted that, if the additional evidence filed by the assessee is taken into consideration, it would explain the source of the fund deposits in Page 3 of 6 the bank account as well as the use for registration charges of house property.
On the other hand, the learned DR has submitted that despite various opportunities, the assessee did not file any supporting evidence either before the Assessing Officer or before the learned CIT (A). The additional evidence sought to be filed by the assessee also does not prove the case of the assessee in the absence of the creditworthiness of the donors and loan creditors. Thus, the learned DR has opposed to the admission of the additional evidence.
We have considered the rival submission as well as relevant material available on record. The case of the assessee was selected for limited scrutiny under CASS to examine the following issues: i) Income from salary ii) Cash Deposits made during the year & iii) Transactions in respect of properties
The Assessing Officer has made addition on account of cash deposits in the bank account of Rs.15,83,000/- in the absence of any evidence showing the past savings and claim of gift received from the parents used for the purpose of purchasing the house property (new Flat). Similarly, the Assessing Officer has made an addition of Rs.3,15,100/- as unexplained investment towards registration charges of the house property when the assessee has not produced any documentary evidence in support
Page 4 of 6 of the source of the fund. The addition made by the Assessing Officer was confirmed by the learned CIT (A) when the assessee could not furnish supporting evidence. Now the assessee has filed an application for admission of additional evidence and also sought to produce the following additional evidence: a) Gift deed & fathers pan card along with service book b) Fathers bank statement with corresponding entries c) Promissory note for loan taken d) Handwritten note of appellant’s mother e) Self-declared letter of appellant’s sister along with PAN f) Income-tax return for the preceding financial year. g) Copy of loan receipt acknowledgement for property expenses.
Thus, it is clear that some of these evidences being the service book of the Father of the assessee and bank account of his Father are independent record, the genuineness of which cannot be doubted. The Assessing Officer has made the addition by recording the reasons that the assessee has failed to produce any record of the past savings or gift deed by the parent as claimed by the assessee. To meet out such an objection, the assessee has now produced these evidences. Therefore, in our considered view, the additional evidences filed by the assessee in support of the source of fund for depositing in the Bank Account and utilized for the purpose of acquiring the residential property including the registration charges needs to be verified and examined at the level of the Assessing Officer. Hence, in the facts and circumstances of the case, as well as in the interest of justice, we set aside the Page 5 of 6 matter to the record of the Assessing Officer for re-adjudication after verification and examination of the additional evidence filed by the assessee. Needless to say, before passing the fresh order, the assessee be given an appropriate opportunity of hearing.