SH. MANOJ MEHRA,DELHI vs. ACIT, NEW DELHI

This appeal by the assessee is preferred against the order of the Ld. CIT(A)-XVII, New Delhi, dated 24/03/2015, pertaining to Assessment Year 2004-05.

The only issue involved in this appeal is the action of the Ld. CIT(A) by which he has confirmed an addition of Rs.20,00,000/- which has been made by the Assessing Officer on account of gifts received by the minor children of the assessee. Vide ground no.2, the assessee is aggrieved with the action of the Ld. CIT(A) by which he has not given appropriate and adequate opportunity of being heard.

The Ld. AR, at the outset, submitted that earlier, the ld. CIT(A) had allowed relief to the assessee but on an appeal filed by the Department, the Tribunal had set-aside the proceedings to the Assessing Officer and the Assessing Officer again made the additions and which the Ld. CIT(A) has confirmed due to the fact that the assessee was not able to present the donor before the Assessing Officer. The Ld. AR submitted that at that point of time the relations of the donors with assessee were not normal but now the relations are quite normal and the donors can be produced before the Assessing officer and therefore, it was prayed that the matter may be set-aside to the file of the Assessing Officer.

The Ld. DR vehemently argued that the assessee had failed on two occasions to present the donor and therefore, the assessee has no case as the gifts has been received by minor children of the assessee who had considerable income, whereas, the donors had negligible incomes therefore, it was prayed that the grounds of appeal of the assessee may be dismissed.

We have heard the rival parties and have gone through the orders of the authorities below. We find that the assessee during the assessment proceedings, had claimed loans aggregating to Rs.20 lakhs received from his minor son and daughter who inturn had claim to have received through gifts. The AO treated the amount of alleged gifts as unexplained income and made the addition u/s 68 of the Act. The ld. CIT(A) confirmed the action of the AO and therefore, the assessee filed appeal before the Hon’ble ITAT and ITAT remitted the matter back to the file of the Ld. CIT(A) for deciding the issue afresh after considering the merits of the case. The ld. CIT(A) in pursuance of direction of ITAT, decided the appeal vide order dated 03/07/2009 in favour of the assessee. However, on further appeal filed by the Department, Hon’ble ITAT vide its order dated 21/06/2011 remitted the matter back to the file of the AO for deciding afresh after considering the merits of the case and in view of the order of Hon’ble ITAT, the Assessing Officer again made additions and Ld. CIT(A) confirmed the addition. Before the Ld. CIT(A), the assessee attended on 02/09/2014 to record his statement but on 02/09/2014, the assessee did not get his statement recorded and therefore, the case was adjourned to 08/10/2014 for recording his statement. However, on 08/10/2014, the assessee did not attend and therefore on the basis of proceedings on 02/09/2014, the Ld. CIT(A) passed the order against the assessee vide order dated 24/03/2015, whereas after 08/10/2014, the Ld. CIT(A) did not give any opportunity to the assessee to get his statement recorded. Though in the present case a number of opportunities has been provided to assessee as the matter was set aside twice but the recording of statement of assessee is an important part of assessment proceedings, therefore, we deem it appropriate that one more opportunity be given to assessee and therefore we set-aside the issue back to the Assessing Officer who should readjudicate the issue after examination of donors and after examination of assessee by getting his statement recorded. The assessee is directed to cooperate with the proceedings and is further directed to produce the donors before the Assessing Officer at his own.

In the result, appeal filed by the assessee is allowed for statistical purposes.