2001 (6) TMI 163 - AT - Income Tax

Summary

Issues Involved:
1. Validity of notice u/s 148.
2. Service of notice u/s 143(2).
3. Addition on account of unexplained deposits in the bank.
4. Addition on account of investment in NSCs.
5. Addition on account of unexplained investment in Indira Vikas Patra.
6. Levy of interest u/s 139(8) and 217.
7. Deletion of addition on account of unexplained investment in money lending business.
8. Deletion of addition on account of interest income and business income.

Summary:

1. Validity of Notice u/s 148:
The assessee challenged the notice u/s 148 on the grounds of improper service and lack of status specification. The CIT(A) held that the notice was validly served on the assessee's son and the status was not in dispute. The Tribunal upheld this view, emphasizing that the service of notice on the son was valid and the conditions for invoking section 148 were satisfied.

2. Service of Notice u/s 143(2):
The assessee argued that the notice u/s 143(2) was issued beyond the prescribed time limit. The CIT(A) dismissed this plea, noting that the proviso to section 143(2) did not apply to returns filed in response to notice u/s 148. The Tribunal agreed, holding that the notice was validly served within the limitation period.

3. Addition on Account of Unexplained Deposits in the Bank:
The assessee contested the addition of Rs. 9,11,000 as unexplained deposits. The Tribunal found that the peak deposit was Rs. 2,90,806 and confirmed the addition to this extent, deleting the balance amount.

4. Addition on Account of Investment in NSCs:
The assessee argued that the NSCs worth Rs. 12,000 were in the name of his wife, who had independent income sources. The Tribunal accepted this argument and deleted the addition.

5. Addition on Account of Unexplained Investment in Indira Vikas Patra:
This ground was not pressed by the assessee and was dismissed.

6. Levy of Interest u/s 139(8) and 217:
The Tribunal directed the Assessing Officer to charge interest based on the income determined as per the Tribunal's order.

7. Deletion of Addition on Account of Unexplained Investment in Money Lending Business:
The revenue appealed against the deletion of Rs. 10 lacs added by the Assessing Officer. The Tribunal upheld the CIT(A)'s decision, noting the lack of evidence and reasoning for the addition.

8. Deletion of Addition on Account of Interest Income and Business Income:
The revenue contested the reduction of the addition from Rs. 3 lacs to Rs. 1,65,000. The Tribunal found the CIT(A)'s estimate reasonable and dismissed the revenue's appeal.

Conclusion:
The assessee's appeal was partly allowed, and the revenue's appeal was dismissed.