BALAJI CONSTRUCTION ,PUNE vs. INCOME TAX OFFICER WARD -7(3), PUNE

This assessee’s appeal for assessment year 2015-16 arises against the CIT(A)-5, Pune’s order dated 21.05.2018 passed in case no.PN/CIT(A)-5/ITO, Wd-7(3), Pune/10192/2017-18 involving proceedings u/s 143(3) of the Income Tax Act, 1961; in short “the Act”. Heard both the parties. Case file perused.

It emerges at the outset that the assessee’s sole substantive grievance challenges correctness of addition amount of Rs.12,30,417/- made in the course of assessment as an instance of 41(1) of the Act; which in turn has been treated as unexplained cash credits u/s 68 in the CIT(A)’s lower appellate discussion. 3. I have given my thoughtful consideration to vehement rival stands against and in support of the foregoing twin issues involving the very sum of Rs.12,30,417/-. Suffice to say, Mr. Jasnani could not pinpoint any specific material on assessee’s books evidencing actual cessation or remission; as the case may be, so as to attract section 41(1) of the Act. I thus quote CIT vs. Bhogilal Ramjibhai Atara (2014) 43 taxmann.com 55 (Gujarat) and Vardhman Overseas (2012) 343 ITR 408 (Delhi) to delete the impugned addition for this precise reason alone. 4. The legal position regarding section 68 addition of the very sum also fails the test of legality as it amount to hold together a new head of income in first appellate proceedings not sustainable in light of CIT vs. Shapoorji Pallonji Mistry (1962) 44 ITR 891 (SC), CIT vs. Union Tyres (1990) 240 ITR 556 (Delhi) and CIT vs. Sardarilal & Co. (2001) 251 ITR 864 (Delhi) (FB). The same also stands deleted therefore.