2023 (9) TMI 98 - AT - Income Tax

Unexplained cash deposit u/s 69A - as submitted Cash relates to sale of agriculture land and cash is deposited by all the other relevant family members too and further the revenue has not brought on record any evidence or proved that cash deposit relates to some other source - HELD THAT - The issue was grabbed up such a way that the revenue is claiming that the registered deed is duly showing the consideration Rs. 24,65,000/- related to sale of property. Whereas the assessee deposited cash in the bank account amount to Rs. 90,17,000/-. The addition of interest amount to Rs. 60,996/- was agitated by the assessee before the bench. AR argued that the addition of cash deposit is lack of verification by the revenue authorities, before the appeal and assessment stages. In fact, the said appeal is lack of verification from end of revenue. With consent of both the parties, the matter is remitted back to the AO for further adjudication de novo . Needless to say, the assessee should get a reasonable opportunity of hearing in the setting aside proceeding.

Summary

Issues involved:
The judgment involves issues related to the re-opening of the case, validity of notice u/s 148, absence of notice u/s 143(2), sanction for re-opening u/s 147/148, confirmation of cash deposit addition, and assessment framed u/s 144.

Re-opening of case:
The appeal was filed against the order of the ld. Commissioner of Income Tax (Appeals) -2, Jalandhar, for A.Y. 2011-12, emanated from the order of the ld. Income Tax Officer, Ward-2, Phagwara, passed u/s 144/147 of the Income Tax Act 1961. The grounds raised by the assessee challenged the re-opening of the case, issuance of notice u/s 148, absence of notice u/s 143(2), and mechanical nature of the sanction for re-opening u/s 147/148.

Cash deposit addition:
The assessee deposited Rs. 90,17,000 in a bank account claiming it was from the sale of property. The ld. AO treated it as unexplained cash deposit under section 69A of the Act and added undisclosed interest income. The ld. CIT(A) upheld this decision after considering submissions. The amended ground no-4 challenged the addition made solely based on a buyer's letter without proper verification, and the bench accepted this ground. The issue was further discussed regarding lack of verification and denial of reasonable opportunity to the assessee.

Judgment and Remittance:
The Tribunal remitted the matter back to the ld. AO for further adjudication de novo, emphasizing the need for a reasonable opportunity of hearing for the assessee. The appeal was allowed for statistical purposes, with the rest of the grounds considered only for academic purposes. The decision highlighted the importance of proper verification and adherence to legal procedures in such cases.

Separate Judgment by the Judges:
The order was pronounced by Anikesh Banerjee, JM, and the judgment emphasized the legal principles regarding evidence in the context of a sale deed, dismissing the appeal and confirming the addition made by the assessing officer. The judgment stressed the significance of registered documents and the limitations on introducing oral evidence contradicting the terms of such documents.