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Facts
The assessee invested an amount of ₹25,30,000/- in M/s. Wasankar Group during the assessment year 2014-15. The Assessing Officer (AO) reopened the case under Section 147/148 of the Income Tax Act, 1961, and made additions of ₹25,30,000/- and ₹3,03,600/- as presumed interest income.
Held
The Tribunal noted that while the assessee admitted to the investment, the assessment order lacked specific basis or documentation for the addition made. Therefore, the assessment order was quashed, and the case was remanded to the Assessing Officer for a fresh assessment, with the onus on the assessee to establish her claim.
Key Issues
Whether the addition made by the AO towards presumed interest income on the investment was justified without proper basis or documentation, and if not, whether the case should be remanded for fresh assessment.
Sections Cited
250, 147, 148
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Income Tax Appellate Tribunal, NAGPUR BENCH : NAGPUR
Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI K.M. ROY
ORDER PER BENCH:
These appeals have been preferred by the assessee against the separate orders dated 26/06/2024 & 12/07/2024 impugned herein passed by the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi [in short, “Ld.Commissioner”] u/sec. 250 of the Income Tax Act, 1961 (for short, “the Act”) for the Assessment Year (for short, “AY”) 2014-15.
2 ITA.No.2588/NAG/2024 2. Since both the appeals having involved similar facts and issues, therefore the same are heard together and being disposed of by way of this consolidated order by taking into consideration as a lead case. ITA No. 454/NAG/2024
Though the assessee has raised various legal issues and emphasising on that, however, before proceeding to the legal issues, we are inclined to touch the merits of the case.
In this case, on the basis of the information to the effect that the assessee had also invested an amount of ` 25,30,000/– out of her own money with M/s. Wasankar Group during the assessment year under consideration, the case of the assessee was reopened u/sec. 147 of the Act while issuing notice dated 20/03/2020 u/sec. 148 of the Act, which resulted into making additions of ` 25,30,000/– and ` 3,03,600/– being interest @ 12% as presumed and computed by the Assessing Officer on the amount of ` 25,30,000/– by observing and holding that apart from the investment in cash of ` 25,30,000/– with M/s. Wasankar Group during the period, there might be interest income earned from the said investment. Thus, interest can be taken at 12% of the total investment.
The assessee being aggrieved, challenged the said additions before the Ld. Commissioner, wherein as it appears from para 5.1, the assessee has admitted for making the investment in M/s. Wasankar Group, out of her own savings which her husband left, however refuted the aforesaid additions made by the A.O. The assessee during the appellate proceedings, has also submitted the copy of bank statement, details of investments made in cash and cheque amounting to ` 25,30,000/– and confirmation of loan/gift receipt of ` 2,00,000/– and ` 3,00,000/– as mentioned by Ld. Commissioner in para 5.3 (a),
3 ITA.No.2588/NAG/2024 however, learned counsel for the assessee has disputed this fact. Whatever it may be, there is no denial that the assessee made the investment in M/s. Wasankar Group, however, from the assessment order, it is nowhere appears on what basis and what document, the addition has been made specifically the amount of ` 25,30,000/– except relying on the information received qua such investment and, therefore, we are inclined to quash the assessment order itself. However, for just and proper decision of the case and substantial justice, as the assessee herself has admitted for making the investment in the said group and, therefore, in our considered view, it would be appropriate to remand the instant case to the file of the Assessing Officer, being an exception case for considering the relevant investment during the assessment year under consideration and the explanation of the assessee with regard to the investment made, as well as loan/gift taken by the assessee as claimed. We clarify that onus would be upon the assessee to establish its claim. Thus, the case is remanded to the file of the Assessing Officer. As we have set aside the assessment order and remanded the case to the file of Assessing Officer for denovo assessment and therefore inclined not to dwell into the legal aspects raised by the learned counsel for the assessee. Thus, appeal of the assessee is allowed for statistical purposes.
6. As the assessment order, has already been set aside in vide order dated 18/06/2024, and therefore, the penalty does not survive and therefore the same is also deleted. However, the Assessing Officer would be at liberty to initiate the penalty proceedings afresh, if necessity arises. Thus, appeal of the assessee is allowed.
4 ITA.No.2588/NAG/2024 7. In the result, appeals of the Assessee in is allowed for statistical purposes and that of is allowed. Order pronounced in the open Court on 18.06.2025.