P.MURUGANANTHAN ,CHENNAI vs. ITO NON CORPORATE WARD 16(4) , CHENNAI

The assessee has raised several grounds in his appeal however the crux of the issue is that the Ld.CIT(A) has erred in upholding the order of Ld.AO who had made addition of Rs.88,48,000/- invoking Section 68 of the Act.

The brief facts of the case are that the assessee is an individual, filed his return of income for the assessment year 2014-15 electronically declaring income of Rs.2,12,300/-. The case was selected for scrutiny under CASS and notice U/s.143(2) of the Act was issued. Finally assessment order was passed U/s.143(3) of the Act on 29.06.2016 wherein the Ld.AO made addition of Rs.88,48,000/- towards unexplained cash credit U/s.68 of the Act.

During the course of scrutiny assessment, it was observed by the Ld.AO that as per the AIR report that the assessee had made large cash deposits and made payments towards credit card aggregating to Rs.88,48,000/-. Since the assessee was not able to explain the source for the amount of Rs.88,48,000/-, the Ld.AO invoking the provisions of Section 68 of the Act and thereby made addition of Rs.88,48,000/-. On appeal, the Ld.CIT(A) confirmed the Ld.AO because even before him, neither the assessee nor his representative could explain the source for Rs.88,48,000/-.

At the outset the Ld.AR submitted before us that one more opportunity may be given to the assessee in order to explain the source for the aforesaid amount because the assessee is now in possession of all the details which establishes the source of Rs.88,48,000/-. The Ld.DR strongly objected to the submission of the Ld.AR.

We have heard the rival submission and carefully perused the material on record. Though, we do not find much merits in the submission of the Ld.AR, in the interest of justice we are of the view that one more opportunity should be provided to the assessee in order to explain his source for investment/ expenditure. Accordingly we hereby remit the matter back to the file of Ld.AO for fresh consideration directing the Ld.AO to admit any fresh evidence produced before him in order to explain the assessee’s source for the investment/expenditure and thereafter pass appropriate order as per merit and law. The assessee is also directed to co-operate with the Ld. Revenue Authorities in their proceedings in order to expedite their

Ld. Revenue Authorities shall be at liberty to pass appropriate order as per merit and law based on the materials on record.

In the result the appeal of the assessee is allowed for statistical purposes.