SRI. NIJANANDA SWAMY R.S.,BANGALORE vs. ITO, BANGALORE

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ITA 959/BANG/2015Status: DisposedITAT Bangalore22 April 2016AY 2006-075 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal admitted additional evidence provided by the assessee, which included names, addresses, and PANs of the parties from whom the amounts were received. The matter was restored to the AO for a fresh decision.

What were the facts?

The assessee deposited Rs. 14,52,100 in a bank account, claiming it as receipts from civil contracts. The Assessing Officer (AO) added the entire sum to income as the assessee could not provide details of the parties from whom the money was received.

What were the issues?

Whether the AO erred in treating the entire receipt as income without considering the applicability of Section 44AD and whether additional evidence should be admitted to prove the source of funds.

Which sections of the Income-tax Act were involved?

Section 44AD,Section 80DDB,Section 234B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH : BANGALORE

Before: SHRI A.K. GARODIA & SHRI VIJAY PAL RAO

For Appellant: Shri Gurunathan, Advocate
For Respondent: Dr. P.K. Srihari, Addl. CIT(DR)
Hearing: 20.04.2016Pronounced: 22.04.2016

Per A.K. Garodia, Accountant Member

1.

This is an assessee’s appeal directed against the order of ld. CIT(Appeals)-V, Bengaluru dated 19.6.2014 for the assessment year 2006-07.

2.

The grounds raised by the assessee are as under:-

“1. The learned Commissioner of Income-tax (A) erred in passing the order in the manner he did.

2. The learned Commissioner (A) erred in not treating the accumulated sum of Rs.14,52,100/- deposited in the S.B.Account of the appellant with Deepak Sahakari Bank Ltd., Rajajinagar Branch, Bangalore as gross receipts from civil contracts carried out by the appellant.

3. The learned Commissioner (A) failed to appreciate that the provisions of Sec.44AD(1) of the Act were applicable to the above said sum of Rs.14,52,100/-. 4. The learned Commissioner (A) erred in treating the entire receipt of Rs.14,52,100/- as income of the appellant without considering that only 8% of the said sum was taxable as per the provisions of Sec.44AD(I) of the Act. 5. The learned Commissioner (A) erred in upholding the addition of the gross sum of Rs.14,52,100/- which arose from various deposits made in the Deepak Sahakari Bank Ltd., Rajajinagar Branch, Bangalore due to the observation of the AO that amounts were split to under Rs.50,000/- for making the deposits, with a view to prevent the information from reaching the Income-tax Authorities. 6. The learned Commissioner (A) erred in upholding the disallowance of the claim of Rs.60,000/- made u/s. 80DDB of the Act. 7. The learned Commissioner (A) erred in upholding the charging of interest u/s. 234B of the Act. 8. Without prejudice, the addition is arbitrary and unreasonable and liable to be deleted in toto. 9. For these and other grounds that may be urged at the time of hearing of the appeal the appellant prays that the appeal may be allowed.”

3.

It was submitted by the ld. AR of assessee that ground No.6 is not pressed, ground No.7 is consequential and ground Nos.8 & 9 are general. Accordingly ground No.6 is rejected as not pressed, ground No.7 is held to be consequential and no adjudication is called for in respect of general grounds being Nos. 8 & 9.

4.

Regarding ground Nos. 1 to 5, it was submitted by the ld. AR of assessee that only one issue is involved as per the grounds and this issue was decided by the AO against the assessee on the basis that assessee could not produce the name, address and PAN from whom the assessee claims to have received the amounts totalling to Rs.14,52,100. He submitted that now the assessee has made an application for admission of additional evidence under Rule 29 of the Appellate Tribunal Rules, 1963, and as per this additional evidence, assessee has furnished the names, address and PAN of those persons from whom the amount in question was received by the assessee for doing the contract work. He submitted that under these facts, the additional evidence should be admitted and the matter may be restored back to the file of Assessing Officer for fresh decision in light of these evidence.

5.

We have considered the rival submissions. We find that on page 3 of the assessment order it is noted by the Assessing Officer that to verify the source of deposit of cash, assessee was requested to furnish name, address and PAN details of the persons from whom the amounts have been received, but the assessee has filed a letter stating that he does not remember the names of persons from whom he has received such amounts. Under these facts, it was held by the AO that assessee’s statement is far from truth as the assessee is a lecturer in Chemistry and teaches the lessons which learnt earlier. So the assessee’s statement that receipts are from contract works is not acceptable.

6.

Now as per the additional evidence submitted by assessee before us, the assessee has submitted the names, address and PAN details of those persons from whom the assessee is claiming that the amounts in question was received by him for doing contract work. Considering the facts of the present case in its entirety, we admit the additional evidence and set aside the order of ld. CIT(Appeals) on this issue and restore this matter back to the file of the Assessing Officer for fresh decision in light of these additional evidence furnished before us, after providing reasonable opportunity of being heard to the assessee. These grounds being grounds Nos. 1 to 5 are allowed for statistical purposes.

7.

In the result, the appeal of the assessee stands partly allowed for statistical purposes.

Pronounced in the open court on this 22nd day of April, 2016.

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