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Income Tax Appellate Tribunal, “C’’BENCH: BANGALORE
Before: SHRI N.V. VASUDEVANAND SHRI B.R. BASKARAN
The assessee has filed this appeal challenging the order dated 29.11.2019 passed by Ld. CIT(A), Hubballi and it relates to the assessment year 2014-15. The assessee is aggrieved by the decision of Ld. CIT(A) in refusing to admit additional evidences and also in confirming the addition of Rs.59.06 lakhs relating to bank deposits and Rs.69,509/- relating to interest from banks.
Shri Sureshgouda Shankargouda Patil, Bagalkot
Page 2 of 5 2. The facts relating to the case are stated in brief. The assessee filed his return of income for the year under consideration declaring a total income of Rs.9,53,500/-. The A.O. noticed that the assessee has made cash deposits of Rs.52.56 lakhs in Bank of India, Bagalkot and Rs.6.56 lakhs in Canara Bank, Bagalkot. The A.O. noticed that the assessee is a Director in Bilagi Sugar Mills Ltd., Bagalkot and receives remuneration of Rs.9,75,000/-. Besides the above, the assessee has declared loss from house property of Rs.63,000/- and interest income of Rs.1,41,498/-. Hence, the AO asked for explanations from the assessee with regard to the sources of deposits. Since there was no response from the assessee, the A.O. completed the assessment u/s 144 of the Income-tax Act,1961 ['the Act' for short] assessing the aggregate amount of cash deposits of Rs.59.06 lakhs. The A.O. also noticed that the assessee has not declared interest income from banks of Rs.69,509/- and accordingly assessed the same also.
Before Ld. CIT(A), the assessee furnished certain details relating to bank deposits. The assessee offered the explanation for not furnishing those evidences before the AO; i.e., the A.R. of the assessee was unwell on the dates of hearing given by A.O. and hence, the assessee could not be furnish these details before the assessing officer. Since this explanation was not substantiated, the Ld. CIT(A) rejected them. Hence, the Ld. CIT(A) refused to admit the additional evidences and accordingly confirmed the additions made by the A.O. Aggrieved, the assessee has filed this appeal before us.
The Ld. A.R. submitted that the assessment was completed u/s 144 of the Act, since the assessee was not represented by the authorized representative before the A.O. for the reason that he was unwell. Hence, the assessee furnished all the evidences in support
Shri Sureshgouda Shankargouda Patil, Bagalkot
Page 3 of 5 of the bank deposits before Ld. CIT(A) in the form of additional evidences. However, the Ld. CIT(A) has refused to accept the same by not accepting the explanations of the assessee. The Ld. A.R. submitted that the assessee was prevented from furnishing these evidences before the AO for the reasons beyond his control. Accordingly she submitted that the Ld CIT(A) should have admitted the additional evidences. The Ld A.R prayed that, in the interest of natural justice, the assessee should be given one more opportunity to explain the sources of deposits made into the bank account. Accordingly, she prayed that the additional evidences furnished by the assessee be admitted and matter may be restored to the file of the A.O. for examining it afresh.
We heard Ld. D.R. and perused the record. We notice that the A.O. was constrained to complete the assessment to the best of his judgement u/s 144 of the Act in view of non-cooperation from the assessee’s side. It is stated that the A.R. of the assessee was unwell and hence he did not properly represent the matter before A.O. Hence, the assessee has furnished evidences before Ld. CIT(A) to substantiate the cash deposits made into the bank account. We have noticed that the Ld. CIT(A) has refused to admit them. It is a fact that the AR of the assessee did not represent before the AO for the reasons stated above. Hence, in the facts and circumstances of this case, we are of the view that the assessee should not be put into difficulties for the failure of the Ld A.R. Further assessment has been completed by AO to the best of his judgement u/s 144 of the Act. Hence, we are of the view that there was sufficient cause for the assessee in not presenting the evidences before the AO. Accordingly, in the interest of natural justice, the additional evidences furnished by the assessee should have been admitted by Shri Sureshgouda Shankargouda Patil, Bagalkot
Page 4 of 5 Ld CIT(A). Accordingly, we admit the additional evidences. However, these evidences require examination at the end of AO.
Since there was failure on the part of the assessee to properly represent before the A.O., we are of the view that the assessee should bear a cost for causing unwarranted inconveniences to the department. Accordingly, we impose a cost of Rs.2,000/- (Rs. Two thousand only) upon the assessee, which shall be paid to the credit of the Income Tax Department within one month from the date of receipt of this order. Subject to the payment of the above said cost, we set aside the order passed by Ld CIT(A) and restore all the issues to the file of the AO for examining them afresh by duly considering the additional evidences. After affording adequate opportunity of being heard, the A.O. may take appropriate decision in accordance with law.
In the result, the appeal filed by the assessee is treated as allowed for statistical purposes. Order pronounced in the open court on 25th Nov, 2020.