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2015 (6) TMI 522 - AT - Income TaxUnexplained investment - CIT(A) deleted the addition relying on additional evidence filed by the assessee in the form of a confirmation letter issued by the partners of M/s. SK Builders - Held that - A perusal of the copy of the relevant confirmation letter shows that the same does not contain any date. Even the letter stated to be filed by the assessee before the Assessing Officer is also undated and the same does not contain anything to show that the relevant confirmation letter was filed by the assessee before the Assessing Officer alongwith the said letter. On the other hand, there is a clear mention made by the Assessing Officer on page 3 of the assessment order that the claim of the assessee of having paid the amount of ₹ 66,22,500 to persons other than the partners of M/s. SK Builders on the request of M/s.SK Builders, was not supported by any evidence filed by the assessee. We therefore, are inclined to accept the contention of the Learned Departmental Representative that the relevant confirmation letter was filed by the assessee for the first time before the learned CIT(A) and the same constituting additional evidence was relied upon by the learned CIT(A) to give relief to the assessee without giving any opportunity to the Assessing Officer to verify the same. There is thus a clear violation of Rule 46A of the Income-tax Rules, 1962 by the CIT(A), and his impugned order is therefore, liable to be set aside. Thus restore the matter to the file of the Assessing Officer for deciding the same afresh after verifying the relevant confirmation letter filed by the assessee. - Decided in favour of revenue for statistical purposes.
Issues involved:
Assessment under S.153A, investment in land, addition to total income, appeal before CIT(A), additional evidence, violation of Rule 46A, restoration to Assessing Officer. Analysis: Assessment under S.153A: The appeal was against the order of the Commissioner of Income-tax(Appeals) regarding the assessment under S.153A. The assessee, an individual, declared income of &8377; 4,72,540 and agricultural income of &8377; 3,00,000. The Assessing Officer initially determined the total income at &8377; 1,00,46,040. The Tribunal directed the Assessing Officer to examine the investment made in land by the assessee. Investment in Land: The Tribunal directed the Assessing Officer to verify payments made by the assessee towards the purchase of land. The assessee claimed payments of &8377; 80,22,500 were made to M/s. SK Builders for land development. However, the Assessing Officer found discrepancies in the payments, adding &8377; 66,22,500 to the total income of the assessee. Appeal before CIT(A): The assessee appealed before the Commissioner of Income-tax(Appeals) who deleted the addition of &8377; 66,22,500. The CIT(A) relied on a confirmation letter from M/s. SK Builders partners confirming the receipt of the entire sale consideration, stating the amount was related to land purchase. Additional Evidence and Rule 46A: The Revenue appealed before the Tribunal, challenging the deletion of the addition based on the confirmation letter. The Revenue argued that the letter was additional evidence filed for the first time before the CIT(A), violating Rule 46A of the Income-tax Rules, 1962. Decision and Restoration to Assessing Officer: The Tribunal found merit in the Revenue's appeal, noting the violation of Rule 46A. The Tribunal set aside the CIT(A)'s order and restored the matter to the Assessing Officer for fresh consideration after verifying the confirmation letter. The Assessing Officer was directed to provide a hearing to the assessee. Cross Objection: The cross objection filed by the assessee was dismissed as it supported the CIT(A)'s order, which was set aside. The appeal of the Revenue was allowed, and the cross objection was treated as dismissed. This judgment highlights the importance of following procedural rules, such as Rule 46A, in submitting additional evidence during appeals. The Tribunal emphasized the need for proper verification and opportunity for both parties in tax assessments involving investments and land transactions.
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