CHENNIYAPPAN MOHANRAJ,PERUNDURAI TALUK ,ERODE vs. ITO, WARD 2(2), ERODE, ERODE

आदेश/ O R D E R This appeal by assessee is arising out of the order of the Commissioner of Income Tax (Appeals), (in short ‘’the ld. CIT(A)) National Faceless Appeal Centre (NFAC), Delhi in Order No.ITBA/NFAC/S/250/2023- 24/1055535597(1) dated 29.08.2023. The assessment was framed by the Income Tax Officer, Ward 2(2), Erode for the assessment year 2015- 2016 u/s.143(3) of the Income Tax Act, 1961 (hereinafter ‘the Act’), vide order dated 28.12.2017.

Brief facts of the case are that assessee had not explained the 3. source of money for purchase of machinery. As per the assessment order, the Assessing Officer made an addition of unaccounted purchases u/s.69 of the Act as unexplained investment of ₹40,69,290/-. Aggrieved, assessee preferred an appeal before the ld. CIT(A).

The assessee before ld. CIT(A) filed details and ld. CIT(A) 4. accepted the explanation of the assessee with regards to investments made by taking loan from TMB bank of ₹16,50,000/- and other loan from TMB bank of ₹1,50,000/- and thereby deleted the addition of ₹18,00,000/- and balance explanation given by the assessee was rejected and restricted the addition at ₹22,69,290/-. Aggrieved, now the assessee is in appeal before the Tribunal.

I have heard rival contentions and gone through facts and 5. circumstances of the case. As regards to balance addition sustained by the ld. CIT(A) of ₹22,69,290/-, assessee explained that the 6. amounts received and investments made as under:-

Cash gift received from father dated 20.06.2014 7,00,000/- Sale of (i) Power loom dated 20.05.2014. 4,63,000/- (ii) Old Auto power loom dated 20.06.2014 7,00,000/-, ₹1,90,000/- (iii) Old Auto loom dated 20.06.2014 2,50,000/- (iv) Old Auto loom dated 21.06.2014 1,00,000/- (v) Old Auto loom dated 23.06.2014 Out of available bank balance (own fund) 2,40,371/- Ld. Counsel for the assessee stated that there is a bank balance of ₹2,40,371/- available on the date of purchase of machinery and the investment was made after withdrawal of the same. I found that amount is explained and hence the addition of Rs.2,40,371/- is deleted. Balanceaddition of ₹20,28,919/- assessee had tried to explain the source as assessee had received cash gift of ₹7,00,000/- from his father and sale of old auto looms of ₹13,28,919/-. After going through the orders, I hadnoted that none of the authorities below have examined the sourceproperly. Hence, I restore this back to the file of the Assessing Officer who will examine the source to the extent of ₹20,28,919/- and then re-decide the issue after giving opportunity of being heard to the assessee.

Order pronounced in the open court at the time of hearing on 3rd day of January, 2024, at Chennai.