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Income Tax Appellate Tribunal, DELHI BENCH: ‘D’ NEW DELHI
Before: MS SUCHITRA KAMBLE & SHRI PRASHANT MAHARISHI
PER SUCHITRA KAMBLE, JM
This appeal is filed by the Revenue against the order of the Commissioner of Income Tax [Appeals]-II, Delhi dated 26.04.2012 for Assessment Year 2008-09.
The Grounds of appeal
are as under:- 1. "That the Commissioner of Income Tax (Appeals) erred in law and on facts of the case in deleting the addition of Rs.2,31,00,000/- made by the Assessing Officer on account of unexplained cash credit u/s 68 of the Income Tax Act, 1961.
2. (a) The order of the CIT(A) is erroneous and not tenable in law and on facts.
(b) The appellant craves leave to add, alter or amend any/all of the grounds of appeal before or during the course of the hearing of the appeal.”
3. The assessee-company is in the business of construction and Real Estate. The assessee filed return of income declaring nil income on 29.09.2008. Subsequently, the assessee filed a revised return of income declaring loss of Rs.2,35,506/-. The assessment was completed u/s 143(3) of the Income Tax Act after making addition of Rs.2,31,00,000/-. The addition was made u/s 68 of the Act in respect of advance received against project.
Being aggrieved by the assessment order the assessee filed appeal before the CIT(A). The CIT(A) partly allowed the appeal of the assessee.
At the time of hearing none appeared for the assessee despite giving notice on several occassions. Therefore, we are proceeding with the assessment order as well as the order of the CIT(A) and the contentions taken by the assessee before the Revenue authorities will be considered as assessee’s submissions before us.
The Ld. DR submitted that the CIT(A) has not at all taken into account that the documents which were produced before the CIT(A)/Assessing Officer has not at all proved the identity, creditworthiness and genuineness of the parties who have given advances to the assessee. The parties from whom the advances were received, the assessee could not demonstrated the creditworthiness. Thus, the Ld. DR submitted that the CIT(A) erred in deleting the addition of Rs.2,31,00,000/- made by the Assessing officer on account of unexplained cash credit u/s 68.
We have heard the Ld. DR and perused the assessment order as well as order of the CIT(A). It is pertinent to note that the assessee submitted before the Revenue authorities that these are advances against the sale of property.
However, neither before the Assessing Officer nor before the CIT(A), the assessee submitted the details of address, area, rate, price and terms and conditions of such bookings. There is no finding about these facts in the order of the CIT(A) as no details were produced by the assessee. To test one of the ingredients of Section 68 of the Act is to test the ‘genuineness’ of transactions. Therefore, whether the transaction of booking of property was genuine or not was not seen by the CIT(A). Further, there is no finding as to whether subsequent sale has happened or not. In view of this, we set aside this ground of the Revenue’s appeal to the file of the CIT(A) to test the genuineness of transaction on the issues mentioned hereinabove. Needless to say the assessee be given opportunity of hearing before the CIT(A) by following the principle of natural justice. Thus, appeal is partly allowed for statistical purpose.