HARICHANDRASINH DHARMENDRASINH ZALA, BHAVNAGAR V. ITO, W-1(2), BHAVNAGAR, BHAVNAGAR

ITA 1115/AHD/2023

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 6939 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 15-05-2024
• Assessment Year: 2011-2012
• Appeal Filed On: 25-12-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Income from undisclosed sources; Opportunity of being heard; Additional evidence; Set aside
• Section: 68; 144

Judgement Text

आयकर अपीलीय अिधकरण, अहमदाबाद ᭠यायपीठ, एस. एम. सी, अहमदाबाद । IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD ] ] BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER AND SHRI MAKARAND V. MAHADEOKAR, ACCOUNTNAT MEMBER ITA No. 1115/Ahd/2023 Assessment Year : 2011-12 Harichandrasinh Dharmendrasinh Zala 524-C, Kaliyabid, Bhavnagar, Gujarat-364002 Vs Income Tax Officer Ward-1(2), Bhavnagar PAN: AAIPZ1959K अपीलाथȸ/ (Appellant) Ĥ× यथȸ/ (Respondent) Assessee by : Shri M.K. Patel, AR Revenue by : Shri N.J. Vyas, Sr.DR स ु नवाई कȧ तारȣख/Date of Hearing : 16/05/2024 घोषणा कȧ तारȣख /Date of Pronouncement: 30/05/2024 आदेश/O R D E R PER MAKARAND V. MAHADEOKAR, ACCOUNTANT MEMBER This appeal by the assessee is directed against the order of the Commissioner of Income Tax (Appeals) – National Faceless Appeal Centre (NFAC) (hereinafter referred as “CIT(A)”] dated 30.10.2023 for the assessment year 2011-12, wherein the CIT(A) partially confirmed the addition made by the Assessing Officer (hereinafter referred as “AO”) under Section 144 of the Income Tax Act, 1961(hereinafter referred to as “the Act”). 2. Assessee has taken following grounds of appeal: ITA No.1115/Ahd/2023 Harichandrasinh Dharmendrasinh Zala vs. ITO Asst. Year : 2011-12 2 1. The ld. CIT(A)-6, Ahmedabad is erred in law and on facts by confirming addition of Rs. 28,36,415/- out of Rs. 34,94,179/- made by AO on account of cash credit entries and other receipts in bank, treating the same as income from undisclosed sources. 2. The appellant leave to add, amends, delete or alter one or more grounds of appeal. Facts of the Case: 3. The assessee was not filing his return of income. On the basis of information received from ITS data, it was observed that the assessee has made a cash deposit of Rs.28,77,000 in his bank account with State Bank of India, Bhavnagar Branch. The case was re-opened by issuing notice u/s 148. Since the assessee failed to furnish the details as required by the notice u/s 142(1) of the act, the AO completed the assessment under Section 144 of the Act adding all the credit entries in the assessee’s bank account including cash deposits amounting to Rs. 34,94,179/- as unexplained money under Section 68 of the Act. 4. On appeal, the CIT(A) considered the additional evidence filed by the assessee, including the profit and loss account, 7/12 extracts, and bank passbook, which supported the claim of agricultural income. The CIT(A) after seeking remand report from the AO granted partial relief by excluding the amount related to the receipt from the sale of agricultural produce but upheld the remaining addition. 5. The Counsel for the assessee contended before us that the AO has not considered the cash flow statement submitted to him in which cash withdrawals are also reflected. He further stated that the cash deposits are ITA No.1115/Ahd/2023 Harichandrasinh Dharmendrasinh Zala vs. ITO Asst. Year : 2011-12 3 from known sources and explained to the AO. Cash book and the cash flow statement is not considered by the AO while preparing the remand report. Since the CIT(A) has decided the matter on the basis of remand report of the AO, all the details already provided to AO were not fully considered by the CIT(A). 6. The counsel for the assessee placed reliance on the decision of the co- ordinate bench in case of ITO Vs. Murlidhar Ice-cream and Sweet Parlour (ITA No.531/AHD/2012) in which it was held that where there are deposits and withdrawals entries in the bank account, it would be presumed the amount withdrawn was available with the assessee for depositing the same. Therefore, it cannot be concluded that the entire deposits were from unexplained source. 6.1. The AR requested that the matter be remanded back to the AO for a fresh examination of all submitted details. The Departmental Representative did not object to the same. 7. We have heard the submissions of both sides and reviewed the material on record. It is observed that the addition was primarily due to non- compliance by the assessee during the assessment stage. The CIT(A) has given partial relief based on the evidence relating to agricultural income. 8. In the interest of justice and to provide a fair opportunity to the assessee, we deem it appropriate to set aside the order of the CIT(A) and remand the matter to the AO. The AO is directed to re-examine the case, taking into account all the evidence provided by the assessee, including the profit and loss account, 7/12 extracts, cash book and cash flow statement, ITA No.1115/Ahd/2023 Harichandrasinh Dharmendrasinh Zala vs. ITO Asst. Year : 2011-12 4 and any other relevant documents. The AO should pass a fresh assessment order after giving the assessee a reasonable opportunity to be heard. 9. The assessee is directed to cooperate with the AO during the reassessment proceedings and furnish all necessary documents and explanations promptly. 10. In light of the above, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the Open Court on 30 May, 2024 at Ahmedabad. Sd/- Sd/- (SUCHITRA KAMBLE) JUDICIAL MEMBER True Copy (MAKARAND V.MAHADEOKAR) ACCOUNTANT MEMBER Ahmedabad, Dated 30/05/2024 Rajesh आदेश कȧ ĤǓतͧलͪप अĒेͪषत/Copy of the Order forwarded to : 1. अपीलाथȸ / The Appellant 2. Ĥ×यथȸ / The Respondent. 3. संबंͬधत आयकर आय ु Èत / Concerned CIT 4. आयकर आय ु Èत)अपील (/ The CIT(A)- (NFAC), Delhi 5. ͪवभागीय ĤǓतǓनͬध ,आयकर अपीलȣय अͬधकरण,राजोकट/DR,ITAT, Ahmedabad, 6. गाड[ फाईल /Guard file. आदेशान ु सार/ BY ORDER, स×याͪपत ĤǓत //True Copy// सहायक पंजीकार (Asstt. Registrar) आयकर अपीलȣय अͬधकरण, ITAT, Ahmedabad