2021 (4) TMI 1008 - AT - Income Tax

Unexplained investment - AR submitted before us that the assessee had obtained loan from his partner for which he has given the confirmation statement - HELD THAT - Having considered the rival submission, we are of the view that to meet the ends of justice, the matter needs to be remitted back to the file of the Ld. AO for de-novo consideration. Accordingly, we hereby remit the matter back to the file of the Ld. AO with directions to admit any additional evidence filed by the assessee and after examining the same pass appropriate order afresh in accordance with merit and law. Appeal of the assessee is allowed for statistical purposes

Summary

Issues:
1. Appeal against order of Ld. CIT(A) for A.Y. 2006-07.
2. Dismissal of appeal by Ld. CIT(A).
3. Consideration of investment source by Ld. CIT(A).
4. Submission of affidavit and confirmation letter by assessee.
5. Treatment of registered document as incriminating material.
6. Assessment under section 143(3) r.w.s 153A without incriminating material.
7. Request for remittance of matter for fresh consideration.

Analysis:
1. The appeal was filed against the order of the Ld. CIT(A) for the assessment year 2006-07. The assessee raised seven grounds in the appeal challenging the correctness of the order.
2. The Ld. CIT(A) dismissed the appeal, leading to the assessee filing the present appeal before the Appellate Tribunal.
3. The issue revolved around the Ld. CIT(A) not considering the assessee's claim that the investment of a specific amount was made from a loan borrowed by the assessee. The source of investment was a crucial point of contention.
4. The assessee submitted an affidavit and confirmation letter from the lender to support the claim that the investment was made from a loan. However, this submission was not considered by the Ld. CIT(A) during the proceedings.
5. Another ground of appeal was that the registered document related to the investment should not be treated as incriminating material, implying that it should not be used against the assessee.
6. The Ld. CIT(A) upheld the assessment under section 143(3) r.w.s 153A without any incriminating material specific to the assessee, citing a case law: Midwest Gold Ltd. vs. DCIT. This raised concerns regarding the validity of the assessment.
7. The Appellate Tribunal, after hearing the arguments, decided to remit the matter back to the Ld. AO for fresh consideration. The request for remittance was based on the need to allow the assessee to submit additional evidence and for the Ld. AO to pass a new order considering all relevant aspects.

This detailed analysis covers the various issues raised in the appeal and the subsequent decision of the Appellate Tribunal to remit the matter back for fresh consideration.