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2024 (8) TMI 867 - AT - Income TaxUnexplained deposits in bank account - assessee explained that the assessee has received sum from the mother of the assessee, who had expired and Copy of Bank Statements was filed to demonstrate the transactions of loan given by a mother to a Son with duly sworn Affidavit of the assessee - HELD THAT - Since the Mother of the assessee has expired long ago and sufficient evidences have been filed by the assessee to demonstrate the transaction, we set aside the impugned order passed by the learned CIT(A) on this issue and delete the addition on account of unexplained deposit. Now, there remains a small deposit of ₹ 1,000, which is unexplained and this amount can be ascribed out of past savings. Hence, addition of ₹ 1,000, is also hereby deleted. Thus, ground no.2, is hereby allowed. Capital gain from sale of jewellery as short term capital gain - assessee argued that the authorities below have assessed the amount received from sale of jewellery as short term capital gain that too without giving benefit of cost of acquisition - HELD THAT - Assessee filed two purchase bills wherein the year of purchases is 1998. In view of this, we direct the AO to compute the long term capital gain considering Sale Consideration Less Index Cost of Acquisition. Enhancing the income of the assessee on account of interest income of the assessee - HELD THAT - We find that in the remand report dated 20/02/2020, the Assessing Officer stated that the assessee has received interest income which has not been included in the total income. CIT(A) observed that in the reply filed by the assessee in response to the remand report, has not made any comment on this issue and hence the addition was confirmed. Assessee fairly accepted that the addition be confirmed. Consequently, no interference is warranted in the order of the learned CIT(A) on this issue. Thus, ground no.4, is dismissed. Enhancing the income of the Appellant on account of income from house property from the houses owned by the Appellant - HELD THAT - CIT(A) has granted sufficient opportunities to enable the assessee to counter the remand report which the assessee failed to do so and hence the direction of the learned CIT(A) on this issue is found appropriate and no interference is called for in the order passed by the learned CIT(A) on this issue. Accordingly, ground no.5, is also dismissed. Computation of capital gain on the basis of the value adopted for registration process - HELD THAT - As we find that there is a difference between sale consideration of ₹ 14,43,000 and value as per registration is at ₹ 18,75,500. We strongly feel that it was bounden duty of the AO to refer the matter to the Valuation Officer in accordance with the judgment of Sunil Kumar Agrawal 2014 (6) TMI 13 - CALCUTTA HIGH COURT Accordingly, we set aside the impugned order passed by the CIT(A) on this issue and restore the matter to the file of the AO and direct him to re compute the capital gain in accordance with law. Unexplained deposits in bank account sustained for the credit entries appearing in two bank accounts in the State Bank of India - HELD THAT - The addition has been sustained with reference to the credit entries in the bank account. During the course of hearing, assessee fairly submitted that he is not in a position to explain the same in view of the long passage of time. He requested before the Bench to take a reasonable view in this regard. Consequently, keeping in view the withdrawals which may have been re circulated and keeping in mind that the litigation is pending for over a decade and the assessee has tried to co operate at all levels, we confirm the addition in lump sum to end the dispute. Accordingly, the assessee gets relief. Unexplained deposits in bank account - addition with respect to sum total of credits appearing in the bank account of the assessee - HELD THAT - Automatic closure of Fixed Deposit upon maturity which is credited to saving bank account as per the extent procedures of the Bank and hence, the sum cannot be considered to be unexplained credit in the bank account. As per the balance amount of ₹ 1,51,358, he fairly submitted that ₹ 25,202, is income from interest which merits addition in full. The balance amount of ₹ 1,26,156, is income from house property as it is evident that the credit on account of rent. The addition under section 24 of the Act to the extent of 30% is allowable on such income and so the net addition may be restricted to ₹ 88,309, as income from house property. Addition is restricted to ₹ 88,309, as income from house property and ₹ 25,202, towards interest aggregating to ₹ 1,13,511. So the assessee gets relief of ₹ 6,68,783.
Issues Involved:
1. Unexplained deposits in bank accounts. 2. Classification and computation of capital gains. 3. Enhancement of income by interest income. 4. Enhancement of income from house property. 5. Invocation of Section 50C of the Income Tax Act. Detailed Analysis: ITA no.105/Nag./2021 (A.Y. 2010-11) 1. Unexplained Deposits in Bank Accounts: - The assessee challenged the addition of Rs. 5,00,000 as unexplained deposits. - The Assessing Officer (AO) treated Rs. 7,29,500 as income due to the absence of income return filings. - The CIT(A) upheld Rs. 5,00,000 as unexplained due to lack of documentary evidence. - The Tribunal found merit in the assessee's submission, supported by a sworn affidavit and bank statements showing the transaction from the assessee's mother. The addition of Rs. 5,00,000 was deleted. The remaining unexplained deposit of Rs. 1,000 was also deleted, attributing it to past savings. 2. Capital Gains from Sale of Jewellery: - The CIT(A) assessed the jewellery sale proceeds of Rs. 93,500 as short-term capital gains. - The Tribunal directed the AO to compute the long-term capital gain considering the indexed cost of acquisition, resulting in a long-term capital gain of Rs. 43,929. 3. Enhancement of Income by Interest Income: - The CIT(A) enhanced the income by Rs. 68,568 on account of interest income. - The Tribunal confirmed this addition as the assessee accepted the enhancement. 4. Enhancement of Income from House Property: - The CIT(A) enhanced income from house property without providing cogent reasons. - The Tribunal found the CIT(A)'s direction appropriate, given the assessee's failure to counter the remand report, and upheld the enhancement. ITA no.106/Nag./2021 (A.Y. 2011-12) 1. Enhancement of Income by Long-Term Capital Gains on Sale of Flat: - The CIT(A) enhanced the income by Rs. 11,18,783 without giving the benefit of indexed cost and invoked Section 50C. - The Tribunal found that the AO should have referred the valuation to the Valuation Officer as per the Calcutta High Court judgment in Sunil Kumar Agrawal v/s CIT. The matter was restored to the AO for re-computation of capital gains. 2. Enhancement of Income by Interest and Other Income: - The assessee accepted the addition of Rs. 68,662 on account of interest and other income. - The Tribunal sustained this addition. ITA no.107/Nag./2021 (A.Y. 2013-14) 1. Unexplained Deposits in Bank Accounts: - The CIT(A) reduced the addition from Rs. 71,37,136 to Rs. 8,18,488. - The Tribunal, considering the long passage of time and the assessee's cooperation, confirmed a lump sum addition of Rs. 3,00,000, granting relief of Rs. 5,18,488. ITA no.108/Nag./2021 (A.Y. 2014-15) 1. Unexplained Deposits in Bank Accounts: - The CIT(A) reduced the addition from Rs. 42,15,067 to Rs. 7,82,294. - The Tribunal, upon reviewing the evidence, restricted the addition to Rs. 1,13,511, granting relief of Rs. 6,68,783. Conclusion: The appeals for the assessment years 2010-11, 2011-12, 2013-14, and 2014-15 were partly allowed, with the Tribunal providing detailed directions and reliefs based on the merits of each case. The judgment emphasized the importance of documentary evidence and compliance with procedural requirements under the Income Tax Act.
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