ATTUPURATT ISMAIL,THALASSERY V. INCOME TAX OFFICER, WARD-2, KANNUR, KANNUR

ITA 804/COCH/2024

AI Insights

The case involves Attupuratt Ismail, an individual deriving income from a partnership firm, who appealed against the order of the National Faceless Appeal Centre, Delhi, which confirmed the addition of Rs. 5,25,000 as unexplained investment in Swarnanjali Gold, Wandoor for the Assessment Year 2010-11. Initially, the Assessing Officer issued a notice under section 148 of the Income Tax Act, 1961, suspecting that the income had escaped assessment. The assessee failed to comply with the notices under sections 148 and 142, leading to a completion of assessment under section 144, taxing the unexplained investments. The CIT(A) accepted the explanation for one investment but not for the Wandoor investment, leading to the current appeal.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 474683 (ITAT-COCHIN)
• Duration Of Justice: 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-11-2024
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 06-09-2024
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: LEENA LAL
• Assessee Lawyers: R. KRISHNAN
• Keywords: Opportunity of being heard; Unexplained investment
• Section: 148; 144

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN Before Shri Inturi Rama Rao, Accountant Member ITA No. 804/Coch/2024 (Assessment Year: 2010-11) Attupuratt Ismail Attupuratt House Kadavathur P.O. Thalassery 670676 [PAN: ABFPI7471M] vs. The Income Tax Officer Ward - 2, Kannur (Appellant) (Respondent) Appellant by: Shri R. Krishnan, CA Respondent by: Smt. Leena Lal, Sr. D.R. Date of Hearing: 30.10.2024 Date of Pronouncement: 18.11.2024 O R D E R This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)] dated 24.07.2024 for Assessment Year (AY) 2010-11. 2. Brief facts of the case are that the assessee is an individual deriving income from partnership firm. The Assessing Officer, based on the information that the assessee made investment in the partnership firm Swarnanjli Group of firms advanced the opinion that income escaped assessment to tax. Accordingly issued notice u/s. 148 of the Income Tax Act, 1961 (the Act) on 28.032017. The assessee neither complied with the notice u/s. 148 of the Act nor complied with the notice u/s. 142 of the Act calling for details. In the circumstances the AO was constrained to complete the assessment u/s. 144 of the Act brining to tax the investments made in 2 ITA No. 804/Coch/2024 Attupuratt Ismail Swarnanjali Gold, Kalpatta of Rs. 4,50,000/- and Swarnanjali Gold, Wandoor of Rs. 5,25,000/- respectively as unexplained investment. 3. Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order considering the explanation of the assessee that the investment of Rs. 4,50,000/- made in Swarnanjali Gold, Kalpatta is treated as explained. As regards, the investment made with Swarnanjali Gold, Wandoor, the learned CIT(A) had not accepted the explanation that the investment is made out of the savings for want of evidence. Therefore, he confirmed the addition of Rs. 5,25,000/- . 4. Being aggrieved, the assessee is in appeal before the Tribunal. It is submitted before me that the assessee had filed a detailed explanation as regards the source of investment made with Swarnanjali Gold, Wandoor. However, the CIT(A) without adverting to the explanation filed by the assessee merely confirmed the addition. Therefore, he submitted that the matter may be remanded to the file of the AO for de novo assessment in accordance with law after affording opportunity of being heard to the assessee. 5. The learned Sr. DR had no serious objection for remanding of the matter to the file of the AO. 6. I have heard the rival contentions of both the parties and perused the material available on record. The only issue that arises for my consideration is whether or not the CIT(A) is justified in confirming the addition of Rs. 5,25,000/- as unexplained investment made with the firm Swarnanjali Gold, Wandoor. Admittedly the assessee had not explained the source of investment made with Swarnanjali Gold, Wandoor. It is only before the CIT(A) that the assessee made an attempt to explain the source of investment made with Swarnanjali Gold, Wandoor. It appears that the learned CIT(A) without adverting to the evidences filed in support of the source of 3 ITA No. 804/Coch/2024 Attupuratt Ismail investment merely dismissed the appeal. In this circumstance I am of the considered opinion that the matter requires remand to the file of the AO for de novo assessment in accordance with law after affording opportunity of being heard to the assessee. 7. In the result, the appeal of the assessee stands partly allowed. Order pronounced in the open court on 18th November, 2024 Sd/- (Inturi Rama Rao) Accountant Member Cochin, Dated: 18th November, 2024 n.p. Copy to: 1. The Appellant 2. The Respondent 3. The Pr. CIT concerned 4. The Sr. DR, ITAT, Cochin 5. Guard File Assistant Registrar ITAT, Cochin "