Tax Management India. Com
Law and Practice  :  Digital eBook
Research is most exciting & rewarding
  TMI - Tax Management India. Com
Follow us:
  Facebook   Twitter   Linkedin   Telegram

Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2024 (10) TMI AT This

  • Login
  • Cases Cited
  • Summary

Forgot password       New User/ Regiser

⇒ Register to get Live Demo



 

2024 (10) TMI 1569 - AT - Income Tax


Issues:
1. Validity of notice u/s. 148 of the Income Tax Act.
2. Approval for re-opening of assessment.
3. Addition of cash deposits to the tune of Rs. 24,26,960/-.

Analysis:

Issue 1: Validity of notice u/s. 148 of the Income Tax Act
The appeal challenged the addition of Rs. 24,26,960/- by the Ld.CIT(A) due to a notice served under section 148 of the Act. The notice was issued on 31.03.2017, the last day for valid issuance. The argument was that the notice was received by the assessee on 03.04.2017, beyond the deadline. However, the Tribunal held that the notice's issuance before the deadline was sufficient, rejecting the plea as devoid of merit.

Issue 2: Approval for re-opening of assessment
The next ground of appeal was against the re-opening of assessment by the Ld.PCIT. The AO re-opened the assessment due to cash deposits in the assessee's bank account. The AO had given reasons for re-opening on 27.03.2017, approved by Ld.PCIT on 30.03.2017, and notice u/s. 148 was issued on 31.03.2017. The Tribunal upheld the re-opening, citing Explanation 2(a) of section 147, which deems cases where no return of income is filed as cases of income escaping assessment.

Issue 3: Addition of cash deposits
Regarding the addition of Rs. 24,26,960/- due to cash deposits, the AO added the entire amount as the assessee did not provide an explanation. The Tribunal noted that the assessee frequently deposited and withdrew money for money-lending purposes. The peak-credit in the bank account was found to be Rs. 5,12,007/- after considering the opening balance and transactions. The Tribunal accepted the plea that only the peak-credit should be treated as income, aligning with previous assessment years' treatment, resulting in a relief of Rs. 24,09,513/- for the assessee.

In conclusion, the appeal was partly allowed, and the order was pronounced on October 23, 2024, in Chennai.

 

 

 

 

Quick Updates:Latest Updates