ITO, CHENNAI vs. VENKATRAM NAGAPPA NAIK, CHENNAI

PDF · subscribers
ITA 1194/CHNY/2016Status: DisposedITAT Chennai25 November 2016AY 2011-124 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the Assessing Officer had not examined the bank statements and sale deed submitted by the assessee. Therefore, the matter needed to be re-examined by the Assessing Officer to verify the claims of property sale and fund transfers.

What were the facts?

The revenue appealed against the CIT(A)'s order deleting an addition made on account of a Rs. 1,22,25,000/- deposit in the assessee's bank account. The assessee claimed the funds were from property sale and transfers from two companies, but the Assessing Officer found no substantiating material.

What were the issues?

Whether the CIT(A) erred in deleting the addition without allowing the Assessing Officer an opportunity to examine the additional evidence. Whether the claims of property sale proceeds and fund transfers require verification by the Assessing Officer.

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI

Before: SHRI N.R.S. GANESAN & SHRI A. MOHAN ALANKAMONY

For Respondent: Shri S.Venugopalan, C.A
Hearing: 14.10.2016Pronounced: 25.11.2016

आदेश /O R D E R

PER N.R.S. GANESAN, JUDICIAL MEMBER:

1.

This appeal of the revenue is directed against the order of CIT(A) –15, Chennai dated 09.02.2016 for assessment year 2011-12.

2.

Shri Supriyo Pal, the learned department representative submitted that there was a deposit of Rs.1,22,25,000/- in the bank account of the assessee.

The assessee claimed before the assessing officer that the funds were deposited in the bank account on transfer from M/s.Mosaic India Pvt.Ltd. and Ashmita Enterprises. However, no material was filed before the assessing officer to substantiate the claim of transfer of funds from these two institutions.

On appeal by the assessee, the CIT (A) however, found that there was a transfer of funds. The amounts withdrawn from M/s.Mosaic India Pvt.Ltd. and Ashmita Enterprises are re-deposited in the bank account. The CIT (A) admitted the additional evidence before the CIT (A). The CIT (A) without giving any opportunity to the assessing officer, allowed the claim of the assessee. In the absence of any supporting material for deposit of Rs.1,22,25,000/- in the bank account of the assessee, the CIT(A) ought not have deleted the addition made by the assessing officer.

3.

On the contrary, Shri S.Venugopalan, the learned representative for the assessee submitted that the assessee deposited Rs.73,50,000/- on sale of a property in the bank account. The balance amount was transferred from M/s.Mosaic India Pvt.Ltd. and Ashmita Enterprises. Referring to the copies of the bank statement, which is available from page 61 to 85, the learned representative made an attempt to show that these are the transfer entries made in the bank account. The learned representative has also placed on record a copy of the so called sale deed said to be executed by one Shri K.Srinivasa Aiyar. In view of these transactions, according to the learned representative, the deposit in the bank account which was made by transfer of funds from M/s.Mosaic India Pvt.Ltd. and Ashmita Enterprises are substantiated by necessary documentary evidence. Therefore, the CIT(A) has rightly deleted the addition made by the assessing officer.

4.

We have considered the rival submissions on either side and also perused the material available on record. The assessee claims that the sale proceeds of a land to the extent of Rs.73,50,000/- was deposited in the bank account and balance amount was deposited on transfer from M/s.Mosaic India Pvt.Ltd. and Ashmita Enterprises. The copies of the bank statement now filed before this Tribunal was not examined by the assessing officer. On perusing the assessment order, it is obvious that the bank statement was not examined by the assessing officer. Moreover, the claim that the property was sold and the sale proceeds were deposited in the bank account is also not considered by the assessing officer. This Tribunal is of the considered opinion that the claim of sale of property and transfer of funds from M/s.Mosaic India Pvt.Ltd. and Ashmita Enterprises needs to be verified on the basis of the bank statement filed by the assessee. Accordingly, the orders of the lower authorities are set aside and the entire issue is remitted back to the file of the assessing officer.

The assessing officer shall re-examine the matter afresh in the light of the material filed by the assessee namely copies of the bank statement and copy of the sale deed and thereafter decide the issue in accordance with law after giving reasonable opportunity to the assessee.

5.

In the result, the appeal filed by the revenue is allowed for statistical purposes.

Order pronounced on 25th November, 2016 at Chennai.

Recent GST High Court judgments

Search GST case law →