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Income Tax Appellate Tribunal, “A” BENCH: KOLKATA
Before: Shri Mahavir Singh, JM & Shri M. Balaganesh, AM]
Per Shri Mahavir Singh, JM: Both these appeals by assessee are arising out of order of CIT(A)-, Siliguri and CIT, Siliguri vide Appeal No. 96/CIT(A)/Slg/10-11 dated 16.01.2013 and Memo No. CIT/Slg/263/2012-13/8399-8402 dated 18.01.2013 (revision order) respectively. Assessment was framed by ITO, Wd-2(3), Siliguri u/s. 143(3) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for Assessment Year 2008-09 vide his order dated 31.12.2010.
The only issue in is as regards to the order of CIT(A) confirming the addition made by AO on account of cash deposits made in different bank accounts taking the peak credit of individual bank account at Rs.59,73,122/-. According to assessee, combined peak credit will be at Rs.29,24,140/-. Interestingly, Ld. Counsel for the assessee stated that the issue in ITA No. 818/Kol/2013 is also regarding some undisclosed bank accounts but according to him, the CIT has no proved that the assessment order is erroneous and prejudicial to the interest of revenue. On query from the Bench, the Ld. Counsel for the assessee stated that for fresh assessment framed in response to set aside assessment u/s. 263 of the Act by the CIT, there are 3 or 4 more undisclosed bank accounts, which is the subject matter of addition in fresh assessment in view of the directions under 263 of the Act. Ld. Counsel for the assessee made only one plea that in case the assessee’s appeal is set aside to the file of AO for fresh adjudication after taking the combined peak instead of individual peak credit and also can be considered those bank accounts which are considered in the consequential order passed in consequence to section 263 of the Act. When this proposition was put to Ld. CIT, DR, he fairly conceded the position.
We have heard rival submissions and gone through facts and circumstances of the case. We find that the AO has made addition and confirmed the action of AO justifying the addition of Rs.59,73,122/- being the total of individual peak credit made on account of deposits made in different bank accounts. The plea of the assessee is quite reasonable that the combined peak credit is to be taken but for that he has to prove that there is inter-transfer or inter-deposit made out of the withdrawals made. As both the parties agreed that the issues can be remitted back to the file of the AO to re-decide the issue after taking into consideration other 3 or 4 undisclosed bank account where cash deposits are made, the issue needs re-examination. Accordingly, we set aside these orders of the lower authorities and remit the issue back to the file of the AO. However, as regards to the appeal filed by assessee in consequence to revision order passed by CIT u/s. 263 of the Act, we find that the CIT has no where given his finding despite the fact he issued show cause notice on the following grounds: “
1. That, during the course of assessment proceedings, it was found that the assessee had made investments in various Mutual Funds during the financial year 2007-08 relevant to Asst. Year 2008-09. Source of investments made in such Mutual Funds, profits arising from redemption of such mutual funds and the amount of investments available with the assessee at the end of the financial year had not been considered in the assessment order.
2. That, during the course of assessment proceedings, some bank accounts were found to exist in the name of the assessee which were not disclosed in his return of income. Out of these bank accounts, transactions made in two bank accounts maintained by assessee with Axis Bank Ltd. had not been considered in the assessment order.
3. That, in the return filed by for AY. 2008-09, assessee had shown income of Rs.5,200/- from Commission & Brokerage. During the course of assessment proceedings, assessee stated that he is dealing in the business of supply of green tea leaves, From the records, it was seen that the assessee had not furnished any details regarding his income from Commission & brokerage'. Also, no detail was provided by the assessee regarding his business of supply of green tea leaves. As a result, these points remained unverified.”
Finally, CIT set aside the assessment only on the reason that the assessee has not filed anything in his defence by observing in para 2 and 3 as under: “2. Accordingly, a notice U/S 263 of the I.T. Act, 1961 was issued to assessee vide this office No. CIT/Slg/263/2012-13/7014 dated 06.l2.2012 proposing set-aside of the assessment in terms of section 263 of the I.T. Act. 1961 on the grounds enumerated above. The case was fixed for hearing on 21.12.2012. In compliance, Sri Sujit Kumar Basu, Advocate (hereinafter referred to as AR), representing the assessee appeared on 26.12.2012 and stated that he needs some more time to file his written submission. On the request of AR, the case was adjourned to 10.01.20 13.
3 & 742/Kol/2013 Shyam Milan Agarwal, AY 2008-09 3. Nobody attended on 10.01.2013 nor filed any written submission. Till date, neither the assessee nor his AR appeared or filed any written submission. It is thus presumed that the assessee has nothing to submit in his defence and in agreement with the version given in the show-cause letter dated 06.12.2012. The assessment is therefore, set aside on the above issues, in terms of section 263 of the Act. The A.O. shall make in-depth enquiry on the above issues and pass a speaking order based on the merits of the case after affording reasonable opportunities of hearing to the assessee.”
We find that for setting aside of the assessment there should be a definite finding that the assessment is erroneous and also prejudicial to the interest of revenue but nothing is coming out of the order of CIT. In term of the above, we quash this revision order passed by CIT.
In the result, the appeal of assessee in ITA No. 742/Kol/2013 is allowed for statistical purposes and the appeal filed by assessee in ITA No. 818/Kol/2013 against revision order of CIT u/s. 263 of the Act is allowed. Order is pronounced in the open court on 04.05.2016