INCOME TAX OFFICER, WARD-1, KHANNA vs. DHARMINDER KUMAR, LUDHIANA

Aforesaid appeal by revenue for Assessment Year (AY) 2018-19 arises out of an order of learned Commissioner of Income Tax (Appeals), NFAC [CIT(A)] dated 03-09-2024 in the matter of an assessment framed by Ld. AO u/s 144 r.w.s. 147 of the Act on 18.02.2024. The revenue has allowed the appeal by deletion of addition of Rs.2,11,80,491 Lacs as made by Ld. AO in the assessment order. Having heard vehement arguments and upon perusal of case records, the appeal is disposed-off as under. 2. The perusal of the assessment records shows that the assessee has filed the returns of income for the assessment year 2018-19. It is concluded that the assessee had made cash withdrawal of Rs. 2,11,40,000/- from Union Bank of India that the assessee had commission income as commission income. In the absence of any unexplained expenditure, learned AO added that the cash wiithdrawa; of Rs. 2,11,40,000/- as unexplained expenditure under section 69 C and taxed as per Section 115BBE. The income and commission income was assessed under the head "Income from Other Sources". The findings of the ld. CIT(A)) had contained in the appeal. 3. The Ld. CIT(A) had concluded that the withdrawal from the Bank could not be treated as unexplained expenditure u/s 69C. In the remand order, learned AO had confirmed that the assessee was engaged in the money exchange business on commission basis and earned commission income. Considering the facts, the cash withdrawal could not be allowed as explained expenditure under Section 69C. Ld. CIT(A) concluded that the cash withdrawal was only Rs.1,05,70,000/- and on the basis of some information pushed into the Portal that learned AO had reopened the assessment blindly on the basis of some information pushed into the Insight Portal without carrying out any verification u/s 148A and mechanically recorded the reasons for reopening the assessment. Accordingly, the impugned addition was made invoking wrong provisions of the Income Tax Act by recording incorrect facts and without carrying out any further verification of additions made u/s 148A of the Act.