2013 (1) TMI 965 - AT - Income Tax

Summary

Issues Involved:
1. Restriction of addition on account of undisclosed bank account.
2. Consideration of opening balance in the financial year relevant to assessment year 2000-01.
3. Validity of proceedings u/s 147.
4. Addition of unexplained deposits in the bank account.
5. Rejection of application under Rule 46A of Income Tax Rules, 1961.
6. Levy of interest u/s 234B and 234C of the Act.

Summary:

Issue 1: Restriction of Addition on Account of Undisclosed Bank Account
The Revenue contended that the Ld. Commissioner of Income Tax (A) erred in restricting the addition of Rs. 22,78,823/- made on account of an undisclosed bank account to Rs. 10,54,214/-. The Tribunal noted that both the Assessing Officer and Ld. Commissioner of Income Tax (A) partially relied on the figures provided by the assessee, which is inconsistent with the doctrine of approbate and reprobate. The Tribunal remitted the matter back to the Assessing Officer for fresh consideration in light of additional evidence and submissions by the assessee.

Issue 2: Consideration of Opening Balance in the Financial Year Relevant to Assessment Year 2000-01
The Revenue also argued that the Ld. Commissioner of Income Tax (A) erred in directing the Assessing Officer to consider the opening balance of Rs. 1,77,718/- in the financial year relevant to assessment year 2000-01. The Tribunal upheld this direction, instructing the Assessing Officer to take appropriate action for the relevant financial year.

Issue 3: Validity of Proceedings u/s 147
The assessee challenged the initiation of proceedings u/s 147, claiming it was without satisfying preconditions in the Act. However, during the hearing, the assessee's counsel did not press this ground, leading to its dismissal by the Tribunal.

Issue 4: Addition of Unexplained Deposits in the Bank Account
The assessee contended that the Ld. Commissioner of Income Tax (A) erred in making an addition of Rs. 10,54,214/- representing alleged unexplained deposits. The Tribunal found that the assessee failed to provide cogent evidence regarding the purchases and sales claimed. The matter was remitted back to the Assessing Officer for fresh consideration with adequate opportunity for the assessee to present evidence.

Issue 5: Rejection of Application under Rule 46A of Income Tax Rules, 1961
The assessee argued that the Ld. Commissioner of Income Tax (A) erred in rejecting the application under Rule 46A without appreciating that the assessee was prevented by sufficient cause from furnishing evidence during assessment proceedings. The Tribunal noted that the Ld. Commissioner of Income Tax (A) rejected additional evidence and remitted the matter back to the Assessing Officer for fresh consideration.

Issue 6: Levy of Interest u/s 234B and 234C of the Act
The assessee contended that the Ld. Commissioner of Income Tax (A) erred in upholding the levy of interest u/s 234B and 234C. The Tribunal did not specifically address this issue in the summary but remitted the matter back to the Assessing Officer for fresh consideration.

Conclusion:
The Tribunal allowed both the Revenue's and the assessee's appeals for statistical purposes, remitting the matter back to the Assessing Officer for fresh consideration with adequate opportunity for the assessee to present additional evidence and submissions.