ACIT, NEW DELHI vs. SMT. PUSHPA CHAUDHARY, NEW DELHI

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ITA 2983/DEL/2014Status: DisposedITAT Delhi16 June 2016AY 2007-084 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found a contradiction between the AO's treatment of the transaction as an unexplained purchase and the CIT(A)'s treatment as a sale resulting in capital gain. Therefore, the matter was set aside and restored to the AO for fresh assessment.

What were the facts?

The Assessing Officer (AO) made an addition of Rs. 38,20,800/- on account of unexplained investment in immovable property and Rs. 3 lac as income from other sources. The CIT(A) restricted the addition to Rs. 10,17,601/- by treating it as long-term capital gain and deleted the Rs. 3 lac addition.

What were the issues?

Whether the CIT(A) erred in treating an unexplained investment as a sale transaction resulting in capital gains and deleting other income additions without proper re-examination by the AO.

Which sections of the Income-tax Act were involved?

Section 69A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCHES : SMC-II : NEW DELHI

Before: SHRI R.S. SYAL

For Appellant: Shri Vipin Mehra, AR
For Respondent: Shri N.J. Singh, Sr. DR
Hearing: 16.06.2016Pronounced: 16.06.2016

ORDER This appeal filed by the Revenue is directed against the order passed by the CIT(A) on 17.02.2014 in relation to the assessment year 2007-08.

2.

The first issue raised in this appeal is against restricting the addition of Rs.38,20,800/- to Rs.10,17,601/- and the second issue is about deletion of addition of Rs.3 lac made by the AO on account of ‘Income from other sources.’

3.

Briefly stated, the facts of the case are that the AO noticed from AIR that the assessee purchased immovable property on 10.5.2006 for a sum of Rs.38,20,800/-. Notice was issued seeking details. There was no response from the side of the assessee. Eventually, the assessment order was passed u/s 144 making addition u/s 69A to the tune of Rs.38,20,800/-. Apart from that, the AO also estimated ‘Income from other sources’ at Rs.3 lac. When the matter came up before the ld. CIT(A), the assessee furnished certain details. The ld. CIT(A) restricted the addition to Rs.10,17,601/- by computing long-term capital gain. The other addition of Rs.3 lac was also deleted. The Revenue is aggrieved against the deletion of these additions.

4.

I have heard the rival submissions and perused the relevant material on record. It is seen that the AO noticed from the AIR about the assessee purchasing immovable property for a sum of Rs.38.20 lac and the assessment was, accordingly, framed treating the said amount as unexplained investment u/s 69A of the Act. The assessee was absent in the assessment proceedings. However, during the course of first appellate proceedings, the assessee filed certain additional evidence.

The ld. CIT(A) restricted the addition to Rs.10,17,601/- by computing the long-term capital gain. There is an apparent contradiction between the stand of the AO and that of the ld. CIT(A). Whereas the AO made the addition on the basis of AIR information that the assessee purchased the property, the source of which was unexplained, the ld. CIT(A) treated the transaction as that of sale of property resulting into capital gain. This was done on the basis of certain fresh evidence entertained by the ld. CIT(A) which was objected to by the AO. Since the subject matter of the addition got completely changed from purchase of property to sale of property, I am of the considered opinion that the ends of justice would meet adequately if the impugned order is set aside and the matter is restored to the file of AO. I order accordingly and direct the AO to reframe the assessment denovo. The ld. AR has undertaken to 3 provide full cooperation to the AO during the course of fresh assessment proceedings. The AO will also decide afresh about the ‘Income from other sources’ which was estimated by him at Rs.3 lac which got deleted in the first appeal.

5.

In the result, the appeal is allowed for statistical purposes.

The order pronounced in the open court on 16.06.2016.

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