2016 (7) TMI 525 - HC - Income Tax

Addition u/s 69C - undisclosed bank account deposits - Whether the Tribunal was justified upholding the addition to the extent of ₹ 16,15,261/- under section 69 when the authorities below had variously relied upon sections 69A and 69C ? - Held that - There is no dispute on the fact that that the assessee deposited some thing between ₹ 44 laksh and ₹ 49 lakhs with the bank, which he did not disclose in his return. His explanation was restricted to a sum of ₹ 2,65,500/-. Therefore, the assessee could have been made liable for the balance amount under section 69 itself. The learned Tribunal has been lenient and restricted the addition to a sum of ₹ 16,15,261/- for reasons which already we have quoted. - Decided against assessee Whether the Tribunal should have remanded the matter to the Assessing Officer for examination of the source of the said amount? - Held that - No further enquiry on facts required to be made which could have even remotely necessitated a remand. All the facts were there before the learned Tribunal.- Decided against assessee

Summary

Issues:
1. Addition under section 69C based on undisclosed bank account deposits.
2. Discrepancy in the amount of addition made by assessing officer.
3. Tribunal's decision to sustain addition of a specific amount.
4. Questions raised regarding the justification of the Tribunal's decision.

Analysis:
1. The case involves an appeal against the Income Tax Appellate Tribunal's order regarding an addition of ?49 lakhs under section 69C based on undisclosed bank account deposits. The assessee contested the addition, leading to further appeals and the Tribunal's decision to sustain an addition of ?16,15,261.

2. The assessing officer initially added ?49 lakhs as unexplained expenditure from the undisclosed bank account. However, a discrepancy was noted in the total amount mentioned in the assessment order, leading to the CIT(A) considering ?49,09,000 as unexplained deposit. The Tribunal upheld the addition of ?16,15,261, emphasizing the lack of explanation for the source of deposits and withdrawals from the bank account.

3. The Tribunal justified its decision by highlighting the cash deposits and withdrawals made by the assessee, inability to explain the source of deposits, and lack of evidence on how the withdrawn cash was utilized. By considering the peak balance in the bank account, the Tribunal concluded that ?16,15,261 could be deemed as unexplained investment under section 69 of the Income Tax Act.

4. The questions raised in the appeal questioned the Tribunal's decision to uphold the addition under section 69 while authorities had relied on sections 69A and 69C. Additionally, the need for a remand to examine the source of the amount added was challenged. The Court ruled in favor of the Tribunal, stating that no further inquiry was necessary as all relevant facts were already presented before the Tribunal.

In conclusion, the Court dismissed the appeal, affirming the Tribunal's decision to restrict the addition to ?16,15,261 under section 69 of the Income Tax Act, 1961.