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Income Tax Appellate Tribunal, “A” BENCH : BANGALORE
Before: SHRI SUNIL KUMAR YADAV & SHRI INTURI RAMA RAO
Per Sunil Kumar Yadav, Judicial Member
This appeal is preferred by the assessee against the order dated 15.02.2013 of the CIT(Appeals), Hubli for the assessment year 2008-09 inter alia on the following concise grounds :-
“1. The order of the CIT[A] sustaining the additions made by the A.O. in so far as they are against the appellant are opposed to law, equity, weight of evidence, probabilities, facts and circumstances of the case.
2. The learned CIT[A] has seriously erred in law that the creation of the HUF is an after-thought and the extent of agricultural income is not justified with black and white evidence and the appellant was not prevented by sufficient reasons for not filing the additional information, which was filed before the learned CIT[A] before the learned A.O.
3. The learned CIT[A] has seriously erred in failing to appreciate that the deposits of Rs. 11,10,117/- in the fixed deposit account No. 105502831000089 was opened as early as 28/05/1984, which is 28 years back, as stated by the bank and as deposed by the Chief Manager of the Bank [Page No.8 of the CIT(A)'s order] and that being the case, the balance as on 31/03/2008 being the closing balance in the said bank as against the opening balance of Rs.10,20,565/- could not be added as an unexplained investment in the hands of the appellant at all as it was not made during the previous year relevant to the assessment year under appeal under the facts and in the circumstances of the appellant's case.
4. The learned CIT[A] has erred in sustaining the addition on similar grounds in respect of the other bank account in Vijaya Bank for similar such reasons and the addition made of Rs.24,79,914/- at the end of the year deserves to be deleted.
5. The learned CIT[A] is not justified in confirming assessing the income credited to the above bank account to the extent of Rs.80,565/-, which belongs to the HUF separately as he has already added in a sum of Rs.24,79,914/- which is after credit of this interest. Thus, the addition made twice by the learned A.O. ought not to have been confirmed by the learned CIT[A].
6. The learned A.O. is not justified in assessing the income to the best of his judgement by invoking Section 145[1A] of the Act, in respect of business, as accounts have been maintained, books are audited and the undertaking given was with a view to avoid litigation and not that it was income.
7. The income assessed ought to have been telescoped with the other additions made. 8. Without prejudice to the right to seek waiver with the Hon'ble CCIT/DG the appellant denies himself liable to be charged to interest u/s 234B of the Act, which under the facts and in the circumstances of the appellant's case deserves to be cancelled, as there was no obligation to file any estimate and pay advance-tax as the contract receipts and interest from banks, if assessable in the hands of the appellant requires TDS. 9. For the above and other grounds that may be urged at the time of hearing of the appeal, your appellant humbly prays that the appeal may be allowed and Justice rendered and the appellant may be awarded costs in prosecuting the appeal and also order for the refund of the institution fees as part of the costs.”
Ground Nos.1 & 2 are general in nature and no independent adjudication is called for.
Apropos ground No.3, the ld. counsel for the assessee has invited our attention to the bank statement of the FDRs by way of additional evidence which is available at page 20 of the compilation of the additional evidence with the submission that FDRs were not purchased during the impugned assessment year. The investment was made in FDRs prior to 4.1.2007 which was later on to be accumulated to a sum of Rs.11,10,117. Therefore, the addition on account of investment in FDRs is not called for. But this aspect was not examined by the CIT(Appeals) and he confirmed the addition. The ld. counsel for the assessee further contended that since the additional evidence is relevant and goes to the root of the case, it should be admitted and the CIT(Appeals) be directed to readjudicate the issue in the light of additional evidence. These contentions of the assessee were not opposed by the ld. DR. She, however, placed reliance upon the order of CIT(Appeals).
Having carefully examined the aforesaid bank statement and the order of CIT(Appeals), we find that though the assessee has filed this additional evidence before the CIT(Appeals), but he did not admit the same for the reasons discussed in his order. He has not rather looked into the veracity of the documents before adjudicating the issue. We are therefore of the view that this document is required to be examined while adjudicating the issue of addition of Rs.11,10,117 on account of unexplained investment in FDRs. We therefore set aside the order of CIT(Appeals) and restore the matter to his file to readjudicate the issue afresh after affording opportunity of being heard to the assessee.
Apropos ground Nos. 4 & 5, our attention was invited to the bank statements of Vijaya Bank in the name of assessee with the submission that the AO has made an addition of the closing balance with the bank, without looking to the fact that there was opening balance of Rs.40,30,190.
Though various deposits were there during the year, but simultaneously there were withdrawals also from the bank. Therefore, this issue is also required to be re-examined afresh in the light of the bank statement. The ld. counsel for the assessee further contended that the assessee has filed this evidence before the CIT(Appeals), but he did not look into it and confirmed the addition. The ld. DR simply placed reliance on the order of CIT(Appeals).
Having carefully examined the orders of lower authorities, we find that this issue should have been adjudicated in the light of bank statement.
Opening balance in the account cannot be treated to be unexplained investment in the bank during the impugned assessment year. We therefore set aside the order of CIT(Appeals) in this regard and restore the matter to his file with a direction to readjudicate the issue afresh in the light of the bank statements.
With regard to ground No.6, it is noticed from the assessment order that the assessee has himself agreed for the estimation of net profit @ 8%.
Therefore, he lost the right to challenge the addition made on the basis of the statement of the assessee. During the course of hearing, the ld. counsel for the assessee could not justify as to why income at 8% on total receipts should not be worked out. Since we find no merit in the ground of assessee, we dismiss the same and confirm the order of CIT(Appeals).
In the result, the appeal of the assessee is partly allowed for statistical purposes.
Pronounced in the open court on this 26th day of August, 2016.