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Income Tax Appellate Tribunal, ‘A’ (SMC
Before: SHRI ABRAHAM P. GEORGE]
आदेश / O R D E R
Assessee in this appeal is aggrieved on an addition of �12,06,000/-, which was confirmed by the ld.CIT(A).
Facts apropos are that for the impugned assessment year 2. assessee had not filed return of income for the impugned assessment year. Ld. Assessing Officer was having information that assessee had made cash deposits of �12,06,000/- in an ICICI Bank saving account
ITA No. 2425/Mds/2016 :- 2 -: during the relevant previous year. A notice u/s.148 of the Act was issued to the assessee. Despite such notice assessee did not file any return. Ld. Assessing Officer completed the assessment under section 144 of the Act treating the sum of �12,06,000/- as unexplained investment u/s.69 of the Act.
Aggrieved, assessee moved in appeal before ld. 3.
Commissioner of Income Tax (Appeals). Argument of the assessee was that he was not having any source other than agricultural income.
According to assessee, deposits in the bank account came out of sale of agricultural land belonging to his maternal uncle one Shri.
Narayanaswamy. As per the assessee, Shri. Narayanaswamy who was very aged had given the cash to the assessee for safe custody and for constructing a house for Shri. Narayanaswamy’s children. As
per the assessee, Shri. Narayanaswamy died later and his sons Shri.
Murugan and Mr. Guhan had taken the money back from him.
Assessee also submitted that he had not taken the notice issued by the ld. Assessing Officer seriously due to ignorance. In support of his contention, assessee also produced a sale deed dated 27.03.2008 executed by late Shri. Narayanaswamy which reflected a sale of 2.39.60 hectres (approximately 6 acres) of agricultural land for Rs.5,00,000/- by Shri. Narayanaswamy. Assessee also pointed out that the bank account was with Axis Bank and not with ICICI.
ITA No. 2425/Mds/2016 :- 3 -:
Confirmation letters from Shri. Murugan and Shri. Guhan were also filed. Ld. Commissioner of Income Tax (Appeals) sought a remand report from the ld. Assessing Officer on the evidence produced by the assessee.
In the remand report submitted by the ld. Assessing Officer it was stated by him that assessee did not give any evidence in support of its claim that he had received �12,06,000/- from Shri.
Narayanaswamy. According to him, the sale of property on 27.03.2008 could not be considered as an evidence for source of deposits by the assessee in the bank account. Further, as per ld. Assessing Officer, assessee could not show any evidence for the sum of Rs.7,00,000/- claimed as agricultural income earned by Shri.
Narayanaswamy given to assessee for safe custody. Again as per the Ld. Assessing Officer he had summoned legal heirs of Shri.
Narayanaswamy during the course of remand proceedings. According to him, Shri. Guhan had stated that the house was constructed when his father was alive under the direct supervision of his father and expenditure was also met by his father. Ld. Assessing Officer concluded that assessee’s version could not be believed.
Assessee objected to the remand report before ld. Commissioner of Income Tax (Appeals). According to him, a wholesome view was not taken by the ld. Assessing Officer. Assessee
ITA No. 2425/Mds/2016 :- 4 -: also pointed out that Smt. Kaveri daughter of Shri. Narayanaswamy had clearly mentioned that her father was having a lot of dealings with the assessee and her brothers Shri. Murugan and Shri. Guhan were not having sufficient knowledge regarding her father’s transactions.
Ld. Commissioner of Income Tax (Appeals) after considering 6. the submissions of the assessee and remand report of the ld. Assessing Officer confirmed the addition. He disbelieved the claim of the assessee that part of the deposits had gone out of sale consideration received on sale of agricultural land by Shri.
Narayanaswamy and part of the deposits had gone of agricultural receipts of Shri. Narayanaswamy.
Now before me, ld. Authorised Representative submitted that the original assessment was a best of judgment one and assessee was unable to present his case properly. As per the ld. Authorised Representative, even in the remand proceedings, assessee could not conduct a cross examination of Shri. Murugan and Shri. Guhan. Further as per ld. Authorised Representative, daughter of Shri.
Narayanaswamy had clearly stated that his sons Shri. Murugan and Shri. Guhan had no knowledge of the dealings of her father with assessee. In any case as per ld. Authorised Representative Shri.
Murugan and Shri. Guhan had confirmed receipt of �5,00,000/- back
ITA No. 2425/Mds/2016 :- 5 -: from the assessee. This according to him, would show that the money belonged to Shri. Narayanaswamy not to the assessee.
Per contra, ld. Departmental Representative strongly supported the orders of the authorities below.
I have considered the rival contentions and perused the orders of the authorities below. What I find is that daughter of Shri.
Narayanaswamy had given a statement which justified claim of the assessee. She also mentioned that the sons of Shri. Narayanaswamy, namely Shri. Murugan and Shri. Guhan were not having much knowledge of their father’s dealings with the assessee. In my opinion assessee has been able to show that he had close proximity with Shri. Narayanaswamy. Ld. Assessing Officer in the remand report had not taken into consideration the statement given by Shri.
Narayanaswamy’s daughter. Ld. Assessing Officer should have considered the reasonableness of the explanation of the assessee and whether it was supported with enough evidence to generate confidence in what was claimed. In my opinion, an objective analysis was not done by the lower authorities. I am of the opinion that issue requires a fresh look by the ld. Assessing Officer. I set aside the orders of the lower authorities and remit the issue back to the file of ITA No. 2425/Mds/2016 :- 6 -: the Assessing Officer for consideration afresh in accordance with law.
In the result, appeal of the assessee is partly allowed for 10. statistical purpose.
Order pronounced on Wednesday, the 12th day of April, 2017, at Chennai.