INCOME-TAX OFFICER vs. SMT. SUSHAMA MANOHAR ZOLE, KOLHAPUR

PER D. KARUNAKARA RAO, AM :

There are 3 appeals under consideration involving Assessment Year

2011-12. The appeal ITA No.386/PUN/2015 and ITA No.702/PUN/2015 are

the cross appeals. Further, C.O.No.78/PUN/2017 is filed by the assessee in

connection with the aforementioned appeal ITA No.702/PUN/2015 filed by

the Revenue. All these appeals are filed against the order of CIT(A), 1&2,

Kolhapur, dated 05-02-2015.

addition of Rs.67,93,692/- made on account of unexplained investment.

Background facts of the case include that the assessee along with two others

purchased an open land at Survey Nos. 78 and 79 in Kolhapur District for a

sum of Rs.4,42,68,480/-. It includes the Stamp duty (Rs.10,88,640/-) and Registration Charges (Rs.1,31,840/-). Assessee’s share is 1/3rd in the

property and therefore, his investment works out to Rs.1,47,56,160/- only.

The issue relating to the source of investment was scrutinized u/s.147 r.w.s

143(3) of the Act by the AO and his investment to the extent of

Rs.75,88,975/- was accepted holding the balance of Rs.67,93,692/- as

unexplained investment. AO added the same as income of the assessee

u/s.69 of the Act. In this regard, assessee explained the source of

investment which includes various amounts, various parties etc. and

payments were made by the assessee out of the money received by him in

cash and cheque. Assessee also attempted to explain the source of cash

received by him. AO did not accept the same and rejected the evidences

3 ITA Nos.386 & 702/PUN/2015 & CO No.78/PUN/2017 Smt. Sushama Manohar Zole

furnished by him before making the said amount as addition u/s.69 of the

Act.

6 are relevant. However, the CIT(A) confirmed the addition to the extent of

Rs.8,25,318/- only and granted part amounting to Rs.57,48,537/-.

appeal before us vide ITA No.702/PUN/2015. Assessee filed the Cross

Objection against the same supporting the order of CIT(A) and prayed for

grant of entire relief. Further, aggrieved with the decision confirming the

addition to the extent of Rs.8,25,318/- the assessee is in appeal by way of

the cross appeal/objection.

mentioned that the finding of CIT(A) given in Para No.5 of his order

regarding addition of Rs.20,26,925/- is erroneous. It makes the order of

CIT(A) erroneous. Actually, this amount was already accepted by the AO in

the very assessment order and the same was not the issue for adjudication

before the CIT(A). They also brought our attention to Para No.6 of the order

of CIT(A) which does not deal with the issues relating to the correctness of

the sources of the assessee qua the cash receipts. Further, our attention

was drawn to the contents of Para No.5.5 and submitted that the said para

contains various tables which depicts the source of the said cash payments

to the assessee which finally found way into the said investment of

Rs.1,47,56,160/-. CIT(A) has not dealt with the source of the cash,

explanation given by the assessee. AO/CIT(A) have not examined the

persons who have paid money to the assessee. Date-wise elaborate details

given by the assessee were not considered by the CIT(A).

4 ITA Nos.386 & 702/PUN/2015 & CO No.78/PUN/2017 Smt. Sushama Manohar Zole

because the said order does not contain any reasons for giving relief to the

assessee to the extent of Rs.57,48,537/-. CIT(A) is silent on the

aforementioned cash transactions, sustainability of the additions or otherwise

etc. Therefore, it is prayer of the parties that the entire issue relating to

addition of Rs.65,73,852/-, i.e. unexplained investment in the open land

should be remanded to the file of CIT(A) for fresh consideration and for want

of a speaking order on the issue.

authorities, we have noticed that the order of CIT(A) on the addition of

Rs.65,73,852/- cannot be considered as a speaking order qua the said cash

transactions or the source of cash and the other amounts received by the

assessee from various persons. CIT(A) order is also erroneous to the extent

of his finding in Para No.5 of his order. The details given by the CIT(A) in

Para No.6 in our opinion constitutes a very cryptic and non-speaking order.

As such, the figures appearing in Para No.6 are found to be not in tune with

the figures appearing in the Table given in Para No.5.5 of the re-assessment

order. There is need for the CIT(A) to explain in his order bringing clarity.

Therefore, we are of the considered view that the entire issue of addition of

Rs.65,73,852/- needs to be remanded to the file of CIT(A). Therefore, we

direct the CIT(A) to adjudicate this issue afresh and pass a speaking order

considering each of the cash transaction received by the assessee which

formed the source for the investment in the open land. If necessary, he may

call for a remand report as per the rules and procedures. CIT(A) shall hear

the assessee as per the rules. Accordingly, the grounds raised in all these

appeals are allowed for statistical purposes.

5 ITA Nos.386 & 702/PUN/2015 & CO No.78/PUN/2017 Smt. Sushama Manohar Zole

the Cross Objection filed by the assessee are allowed for statistical purposes.

Order pronounced in the open court on this 05th day of January, 2018.

Sd/- Sd/- (VIKAS AWASTHY) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे Pune; �दनांक Dated : 05th January, 2018 सतीश आदेश आदेश क� आदेश आदेश क� क� �ितिलिप क� �ितिलिप �ितिलिप अ�ेिषत �ितिलिप अ�ेिषत अ�ेिषत/Copy of the Order forwarded to : अ�ेिषत

स�यािपत �ित //True Copy// Senior Private Secretary //True Copy// आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune