2014 (7) TMI 856 - AT - Income Tax

Unexplained money Held that - CIT(A) has passed a well-reasoned order and out of the total addition of ₹ 13,85,200/-, an addition of ₹ 2,55,500/- has been confirmed and the balance addition has been deleted by him assessee has allowed his bank account to be used by the students of the coaching centre and the preponderance of human behaviour read with all the evidences establishes this fact in favour of the assessee - assessee being in Australia during the period when assessment proceedings were going on, he was prevented by sufficient cause in producing all the evidences before the AO and the additional evidences were accepted under Rule 46A - amount of opening balance could not be established by the assessee and therefore, the addition of the same was confirmed by the CIT(A) and the balance addition was deleted the order of the CIT(A) is upheld Decided against Revenue.

Summary

Issues:
Appeal against CIT(A) order for AY 2007-08 - Addition of unexplained money.

Analysis:
The appeal was filed by the Revenue against the CIT(A) order for the assessment year 2007-08 regarding the addition of unexplained money amounting to Rs. 11,29,700. The only ground of appeal by the Revenue was the deletion of this addition by the CIT(A).

The Revenue argued that cash deposits in the assessee's bank account remained unexplained and were rightly added to the assessee's income. The Assessing Officer's order was relied upon by the Revenue to support their case.

On the other hand, the assessee appeared in person and submitted written evidence supporting their case, primarily relying on the CIT(A)'s order.

Upon reviewing the submissions and orders of the Assessing Officer and CIT(A), it was found that the CIT(A) had provided a well-reasoned appellate order. Out of the total addition of Rs. 13,85,200, the CIT(A) confirmed an addition of Rs. 2,55,500, while deleting the remaining balance. The CIT(A) noted that the assessee had provided evidence such as passport copies of students, cheques issued to specific entities, statements, affidavits, migration visas, and other documents to explain the credit entries in the bank account. The CIT(A) concluded that these amounts were not gifts but payments made to students using the assessee's bank account for legitimate purposes. The CIT(A) also accepted additional evidence submitted under Rule 46A due to the assessee's unavailability during assessment proceedings. The opening balance of Rs. 2,55,500 could not be proven by the assessee, leading to its confirmation as an addition. Ultimately, the CIT(A)'s order was upheld, stating that no interference was warranted as it was a balanced decision based on all the evidence presented.

Consequently, the appeal of the Revenue was dismissed, affirming the CIT(A)'s order. The judgment was pronounced in Ahmedabad on June 6, 2014.