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Income Tax Appellate Tribunal, “A” BENCH: KOLKATA
Before: Shri P. M. Jagtap & Shri S.S. Viswanethra Ravi
ORDER Shri S.S. Viswanethra Ravi, JM:
This appeal filed by the assessee against the order dated 31.10.2014 passed by the Commissioner of Income Tax(A)-XXX, Kolkata for A.Y 2010-11.
The only issue covering all the grounds raised is to be decided is as to whether the CIT-A is justified in confirming the addition made by the AO without having given proper opportunity to the assessee in the facts and circumstances of the case.
The brief facts of the case are that the assessee is an individual and engaged in contractual jobs. The assessee filed his return of return of income declaring total income of Rs.1,55,210/- and notices u/s. 143(2) and 142(1) of the Act were issued. In response to which, an authorized representative on behalf of the assessee appeared from time to time.
Somnath Chakraborty Assessment Year: 2010-11 4. During the course of assessment proceedings the AO found the cash deposits of Rs.48,35,000/-,Rs.1,13,22,850/- and Rs.20,61,320/- in assessee’s saving bank accounts with ING Vysya Bank, Dhanalakshim Bank Ltd and ICICI Bank respectively. According to AO, these three bank accounts were not disclosed in the return of income and not reflected in the income and expenditure accounts and balance sheet. For not producing the books of account and corroborating evidences, the AO issued above notice u/s. 142(1) of the Act. In response to which the assessee filed letter dt. 14-03-2013 stating that apart from his contractual job, he also involved in acting as an entry operator to oblige parties who wanted cheque against cash. For which, he would get 20 -25 paise per Rs.100 as commission and admitted non offering of said commission as his income in the return of income, but, however, offered an additional income of Rs.45,548/- @ 25 paise on total cash deposits of Rs.1,82,19,170/-. The AO found that the submissions of the assessee were not acceptable and he was of the opinion that the assessee did not voluntarily disclose the said three bank accounts and for not explaining the source of such huge cash deposits, the AO treated the assessee failed to explain the same and accordingly, the AO determined the income of the assessee at Rs.1,84,19,930/- as against Rs.1,55,210/- vide its order dated 26.03.2013 u/s 143(3) of the Act.
Aggrieved, the assessee pursued his case before the CIT(A) wherein the CIT(A) dismissed the grounds by observing that the three bank accounts were not voluntarily disclosed, the source of cash deposits amounting to Rs.1,82,19,170/- was not disclosed and the transaction details in the form of documents, papers or books of accounts were not furnished to the AO. The CIT(A) also opined that the AO has not logically pursued the matter by enquiries into the identities of the beneficiaries.
Somnath Chakraborty Assessment Year: 2010-11 6. The Ld.AR submits that there was no proper opportunity for the Assessee to explain about huge cash deposits before the AO and in support of his contention referred to para no-3. The Ld.AR also pointed out that the CIT-A also found the AO did not enquire into the identities of the beneficiaries and referred to Para No.3.2 of CIT(A) and argued, in view of the circumstances above before the AO and CIT(A) prayed to remand the matter to the file of AO. The Ld.AR also ensured that the Assessee would prosecute his case properly without seeking any adjournments. The ld. DR opposed the same and argued that inspite of having many opportunities the assessee failed to explain the source of huge cash deposits in the aforesaid bank accounts by furnishing proper evidences and books of accounts before the AO and CIT-A. Therefore, the order passed by the CIT(A) is correct and prayed to dismiss the appeal of the assessee.
Heard both parties and perused the materials available on record. It is observed from the record that the assessee replied to the notice u/sec 142(1) of the Act by way of letter dt: 14-03-2013 stating that apart from his contractual job, he also involved in acting as an entry operator to oblige parties who wanted cheque against cash. For which, he would get 20 -25 paise per Rs.100/- as commission and admitted non offering of said commission as his income in the return of income, but, however, offered an additional income of Rs.45,548/- @ 25 paise on total cash deposits of Rs.1,82,19,170/-. We find from Para no-3 of the AO’s order that the assessee did not explain huge cash deposits as well as the transactions entered into bank accounts by furnishing any detailed evidences before the AO. But, however, it is seen from the record the CIT(A) observed that the AO could not pursue the matter by initiating enquiries into the identities of the beneficiaries and it goes show that the AO did not conduct proceedings properly and treating the assessee as failed to give proper explanation is improper. Since there was no satisfactory
Somnath Chakraborty Assessment Year: 2010-11 explanation as discussed above, taking into consideration the same together with addition made on account of undisclosed income, in our opinion, it requires a proper explanation to the satisfaction of AO and in view of the arguments advanced by the ld. AR and the circumstances emanating from the record, in the interest of justice we deem it proper to remand the matter to the file of AO for his fresh adjudication. The assessee is in liberty to file evidences, if any, in support of his claim and shall co-operate with the AO in disposing the assessment as expeditiously as possible.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 06.12.2017.