MUKTHYAR SINGH YADAV,NEW DELHI vs. ACIT CIRCLE-66(1), NEW DELHI

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ITA 4002/DEL/2019Status: DisposedITAT Delhi19 March 2020AY 2014-154 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the CIT(A)'s order lacked clarity regarding the nature of business and the explanation for bank deposits. Therefore, the issue of unexplained cash credit was remanded back to the CIT(A) for fresh adjudication.

What were the facts?

The assessee, a government employee, declared salary, rental, and other income. The Assessing Officer made additions for unexplained cash credit under Section 68 and other minor adjustments. The CIT(A) dismissed the assessee's appeal.

What were the issues?

Whether the CIT(A) erred in confirming the addition of unexplained cash credit under Section 68 without a clear finding on the nature of business and source of deposits.

Which sections of the Income-tax Act were involved?

Section 68,Section 44AD

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘I(2

Before: MS SUCHITRA KAMBLE, & SHRI PRASHANT MAHARISHIHone No. 606, Rajokari

Hearing: 03.03.2020Pronounced: 19.03.2020

ORDER PER SUCHITRA KAMBLE, JM

This appeal is filed by the assessee against the order dated 28/01/2019 passed by CIT(A)-21 for Assessment Year 2014-15.

2.

The grounds of appeal are as under:-

1. “On the facts and circumstances of the case, the order passed by the learned CIT(A) is bad, both in the eye of law and on the facts.

2. On the facts and circumstances of the case, Id. CIT(A) has erred both on facts and in law, in rejecting the contention of the assessee, that the assessee was engaged in the business of sale of milk to retail customers and was carrying the same business from the last many years & has been accepted by the department. 3. On the facts and circumstances of the case, Id. CIT(A) has erred both on facts and in law, in rejecting the contention of the assessee that the assessee is covered under section 44AD and is carrying on an eligible business and is not required to keep the books of accounts. 4. (i) On the facts and circumstances of the case, Id. CIT(A) has erred both on facts and in law in confirming an addition of Rs. 5,71,000/- u/s 68 on account of peak cash credit rejecting the explanations and evidences filed by the assessee.

5. On the facts and circumstances of the case, Id. CIT(A) has erred both on facts and in law in confirming the addition made by A.O. u/s 68 of the Act, despite the fact that assessee does not maintain books of accounts, hence no addition u/s 68 is called for.”

3. The assessee is a Government Employee and filed his income tax return showing salary income, rental income and income from other sources. The assessee declared income of Rs. 24,93,020/-. The Assessing Officer made addition of Rs. 3,956/- in respect of income from house property and Rs. 5,71,000/- in respect of addition u/s 68 of the Income Tax Act, 1961 as unexplained cash credit. The Assessing Officer further made addition of Rs. 2,483/- in respect of balance interest.

4.

Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee.

5.

None appeared on behalf of the assessee and there is no adjournment application on behalf of the assessee. The notice has been served to the assessee. Therefore, we are taking up the submissions of the assessee before the CIT(A) as well as before the Assessing Officer.

6.

The Ld. DR relied upon the assessment order and the order of the CIT(A).

7.

We have heard the Ld. DR and perused the material available on record. There is a delay of 29 days in filing the present appeal is condoned. From the perusal of the order of the CIT(A), it is not clear that the assessee had undertaken some business during the assessment year as there is only mention of Section 44AD, but there is no mention of nature of business. The CIT (A) has also not given any categorical finding as to why the sources of deposits made in the bank accounts remain unexplained. Therefore, it will be appropriate to remand back this issue to the file of the CIT (A) for fresh adjudication. Needless to say, the assessee be given opportunity of hearing by following principles of natural justice. The appeal of the assessee is partly allowed for statistical purpose.

8.

In result, the appeal of the assessee is partly allowed for statistical purpose.

Order pronounced in the Open Court on 19th March, 2020.

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