Loading judgment…
Facts
The assessee, a sole proprietor, appealed against an order confirming an addition for an undeclared foreign asset of Rs. 91,39,725/-, which was acquired in June 2014 but not properly declared. The AO and subsequently the NFAC (First Appellate Authority) found the declaration unclear and lacked evidence for prior disclosure or the source of investment from taxable income.
Held
The Tribunal upheld the findings of the NFAC, stating that no interference was required with their conclusion. It observed that the assessee failed to produce evidence to support their contentions regarding the asset's declaration and the source of investment, emphasizing that the explanation of the investment's source from taxable income was crucial.
Key Issues
Whether the lower authorities were justified in confirming the addition for an undeclared foreign asset due to the assessee's failure to substantiate its prior declaration and source of investment.
Sections Cited
143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCHES : F : NEW DELHI
Before: SHRI S. RIFAUR RAHMAN & SHRI ANUBHAV SHARMA
This appeal is preferred by the assessee against the order dated 28.03.2024 of the National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) in Appeal No.CIT(A), Delhi-18/10346/2019-20 arising out of the appeal before it against the order dated 24.12.2019 passed u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) by the ITO, Ward 52(1), Delhi (hereinafter referred to as the Ld. AO).
Heard and perused the record. At the time of hearing, none appeared for the assessee and the notices have been issued repeatedly including being served by mail. No further opportunity is justified. The ld. DR supported the findings of the ld. tax authorities below.
After going through the material before us and the impugned orders, we find that the assessee is a sole proprietor engaged in the business of trading and exporting of oils and grains under the name and style of Solution International Inc. The return, when examined in limited scrutiny, it was found that the assessee had acquired a new foreign asset amounting to Rs.91,39,725/-. The investment was, in fact, made in June, 2014 and was shown in 2015-16. The AO was not satisfied with the claim of assessee that it is an asset already declared as the name of the assessee was written in Arabic and was not clear. In appeal, the NFAC observed that no evidence was produced that this asset was declared in the return of earlier years and that scrutiny assessment was carried out in that year. We find substance in the conclusion drawn by the NFAC that in the absence of evidence to support the contentions no benefit could have been extended to the assessee. NFAC has correctly observed that it is not merely about the declaration, but, explanation of the source of investment which should be out of the taxable income which was required to be established. It appears 2 that NFAC has decided the case on the submissions and the assessee had not sought any opportunity of personal hearing. The submissions as mentioned in the order of NFAC mentions that the AO has ignored documentary evidences submitted on 09.12.2019. However, in the absence of any assistance on record in the form of any paper book or submissions, this fact is not established. Thus, the conclusion drawn by the NFAC requires no interference.