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Facts
The assessee's appeal is against the CIT(A)'s order upholding an addition made by the AO under Section 68/69 of the Income Tax Act for AY 2016-17. The addition pertains to unexplained capital contributions from two partners amounting to Rs. 76,02,600.
Held
The Tribunal admitted additional evidence presented by the assessee concerning the capital contribution and remitted the issue back to the AO for re-adjudication. The appeal was allowed for statistical purposes.
Key Issues
Whether the additional evidence provided by the assessee is admissible and if the issue of unexplained capital contribution should be remanded to the AO for fresh consideration.
Sections Cited
250, 143(3), 68, 69
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, A BENCH,
Before: Dr. MANISH BORAD & SHRI VINAY BHAMORE
PER DR. MANISH BORAD, ACCOUNTANT MEMBER:- This appeal at the instance of assessee is directed against the order of Ld. CIT(A) NFAC dated 13.07.2024 framed u/s 250 of the Income Tax Act 1961 for A.Y. 2016-17 which is arising out of Assessment Order u/s 143(3) of the Act dated 27.12.2018 framed by the Income Tax Officer, ward 8(2), Pune.
The effective grounds of appeal are raised against the addition made by Assessing Officer (AO) u/s 68/69 of the Act at Rs. 76,02,600/- being the unexplained amount received from the partners.
1. 3. At the outset Ld. Counsel for the assessee submitted that A.Y. 2016-17 i.e. F.Y. 2015-16 is the first year of the partnership firm as it is incorporated on 01.11.2015. The partners contribution to the capital account is Rs. 2,63,52,600/- and land has been purchased during the year and there is no other transaction. Out of the total partnership capital contribution Ld. AO is not satisfied with the source of capital contribution of Rs. 22,00,000/- and Rs. 54,02,600/- received from Smt. Raji N. Kataria and Shri Santkumar R. Budhani respectively. He further referred to the application for admission of additional evidence placed at Paper Book page No. 66-88 and stated that if an opportunity is granted and the additional evidence are examined by the AO the assessee is hopeful to satisfy the AO to explain the nature and source of the alleged sum received from the partners.
Ld. Departmental Representative (DR) supported the order of the lower authorities.
We have heard rival contentions and perused the record placed before us. The impugned addition is only with regard to the capital contribution from two partners namely Smt. Raji N. Kataria Rs. 22,00,000/- and Mr. Santkumar R. Budhani Rs. 54,02,600/- Before both the lower authorities assessee has failed to explain the nature and source of the alleged sum to the satisfaction of Ld. CIT(A) as well as Ld. AO. Before us additional evidence in the form of registration of M/s Budhani Enterprises as proprietary concern of Shri Santkumar Budhani and Cash Book of Smt. Raji N. Kataria for F.Y. 2014-15 and F.Y. 2015-16 has been filed with the prayer to admit the additional evidence and restore the issue back to the file of Ld. Jurisdictional Assessing Officer (JAO). Ld. DR has objected to this request of Ld. Counsel of assessee.
We however considering that the additional evidence goes to the root cause of the issue under consideration, therefore we admit the additional evidence and remit them back to the file of Ld. JAO to decide the issue under consideration in accordance with law. Needless to mention that proper opportunity of hearing shall be granted to the assessee. Assessee is also directed to remain vigilant and not to take adjournment unless otherwise required for reasonable cause. Effective grounds of appeal raised by the assessee are allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes.
Order pronounced on this 22nd day of August, 2025.