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Facts
The assessee appealed against the CIT(A)'s order confirming an addition of Rs. 26 lakhs out of an initial Rs. 1.73 crores made by the Assessing Officer as unexplained investment for AY 2012-13. The assessee contended that these were genuine own funds, supported by their income tax return, and sought to submit additional evidence regarding HDFC bank transactions. Delay in submitting evidence was attributed to being a non-resident Indian and communication gaps.
Held
The Tribunal found the additional evidence highly relevant for explaining the source of investments and going to the root of the issue. Consequently, the appeal was restored to the CIT(A)-NFAC for a fresh adjudication, with the responsibility on the taxpayer to file and prove all relevant facts. The appeal was allowed for statistical purposes.
Key Issues
Whether the CIT(A) erred in confirming the addition of unexplained investment under section 69C, and if additional evidence explaining the source of funds should be admitted, necessitating a remand for fresh adjudication.
Sections Cited
s.147, s.144, s.139(1), s.69C
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI “D” BENCH : MUMBAI
Before: SHRI SATBEER SINGH GODARA & SHRI GIRISH AGRAWAL
ORDER PER SATBEER SINGH GODARA, J.M. This assessee’s appeal, for assessment year 2012-2013, arises against National Faceless Appeal Centre [in short the “NFAC”] Delhi’s Din and Order No. ITBA/NFAC/S/250/2023-
2 ITA.No.1795/MUM./2024 24/1062428135(1), dated 12.03.2024, in proceedings u/s.147 r.w.s.144 of the Income Tax Act, 1961 (in short “the Act”).
Heard both the parties. Case file perused.
The assessee pleads the following substantive grounds in the instant appeal :
“The Id. CIT(A) erred in confirming the addition of Rs. 26,00,0007- out of total addition made by assessing officer of Rs. 1,73,00,000/- . 2(a) The Id. CIT(A) erred in not appreciating that above amounts are genuine own funds of the appellant and having creditworthiness which can be verified from his return of income also. 2(b) The appellant during submissions made in proceedings stated that he has income from .various sources including salary, rent, other sources etc. He also filed return of income u/s 139(1) for the above AY 2012-13 showing gross total income of Rs. 64,27,1787-.
3 ITA.No.1795/MUM./2024 3. The appellant prays that the findings of CIT(A) are incorrect and amount of Rs.26,00,000/- added back to returned income be deleted in full.”
Both the learned representatives reiterated their respective stands against and in support of the impugned disallowance amounting to Rs.26 lakhs u/sec.69C of the Act representing alleged unexplained investment as upheld in the learned CIT(A)-NFAC’s order.
We note in this factual backdrop at the outset that the Assessing Officer had in fact added assessee’s alleged unexplained investment of Rs.1,73,00,000/- which stands upheld only to the etent of Rs.26 lakhs in the CIT(A)-NFAC’s lower appellate discussion. Learned DR vehemently contended that the CIT(A)- NFAC’s herein has already granted substantial relief to the assessee in the foregoing terms.
Learned authorized representative on the other hand invited our attention to the assessee’s Rule-29 application dated 08.07.2024 seeking to place on record his additional evidence explaining the source of the addition amount of Rs.26 lakhs
4 ITA.No.1795/MUM./2024 representing various debit balance instances as his HDFC bank account. He has further explained delay in filing thereof to the effect that he is a non-resident Indian who had faced various communication gaps because of miscellaneous reasons. The Revenue could hardly dispute that the fact that not only the assessee’s foregoing additional evidence is relevant but also it goes to root of the issue raised at the assessee’s behest since explaining source of the investments forming subject matter of addition. We thus deem it appropriate in the larger interest of justice to restore the assessee’s instant appeal back to the CIT(A)-NFAC for it’s afresh adjudication, preferably within three effective opportunities of hearing, subject to the rider that it shall be the taxpayer’s onus and responsibility only to file and prove all the relevant facts in consequential proceedings. Ordered accordingly.
This assessee’s appeal is allowed for statistical purposes in above terms.
5 ITA.No.1795/MUM./2024 Order pronounced in the open Court on 18.07.2024