2014 (3) TMI 261 - AT - Income Tax

Addition u/s 68 of the Act Cash deposit out of undisclosed sources of income No documentary evidences furnished - Held that - The decision in Shri Manan Jain Versus ITO 2014 (2) TMI 1019 - ITAT DELHI followed The assessee has claimed that there was planning to purchase the land jointly with his father Shri Subhash Chand Jain for group housing complex at G.T. Road, Sonepat, Haryana - Assessee had not filed any documentary evidence in this regard. Assessee s claim that the amount was withdrawn for initial payments to land owners though Satbir Singh with whom the assessee was negotiating to purchase the land but assessee failed to produce the same - It is claimed that agreements to sell were prepared with respect of the deal with the intended sellers - no evidence was filed in this regard. The assessee also claims that he came to know at later stage that the land, which was intended to be purchased, was already identified by the HUDA for the purposes of housing complex for M/s. Omaxe Limited - None of the claims of the assessee as made in letter are substantiated by any documentary evidence - Even the concerned persons with whom the transaction were made or negotiated were not produced thus, the claim of assessee that cash withdrawal was not utilized for other purposes have remained unproved - Primary onus is on assessee to substantiate the claim of failure of land deals due to which cash remained unutilized - Assessee had not discharged onus by filing any evidence either documentary or oral in this regard - thus, the matter remitted back to the AO for fresh adjudication Decided in favour of Assessee.

Summary

Issues:
- Assessment of cash deposit from undisclosed sources under section 68 of the IT Act
- Confirmation of penalty under section 271B of the IT Act
- Remittal of appeals to the Assessing Officer for fresh decision

Assessment of Cash Deposit:
The appeals (ITA Nos. 1842/Del/2011 and 1843/Del/2011) were against the orders of the Ld. CIT(A)-XXII, New Delhi, regarding the addition of cash deposits from undisclosed sources under section 68 of the IT Act. The Assessing Officer had made additions in the cases of two assesses for the Assessment Year 2006-07. The CIT (A) upheld these additions, leading to the appeals. The counsel for the assesses argued that similar circumstances in a connected case led to a remittance of the matter to the Assessing Officer for fresh decision. The Tribunal found merit in this argument, noting the lack of documentary evidence supporting the claims made by the assesses regarding the cash deposits. As a result, the appeals were remitted to the Assessing Officer for a fresh decision, ensuring due opportunity for the assesses to present their case.

Confirmation of Penalty:
In a related matter, ITA No. 1844/Del/2011 involved the challenge against the levy of a penalty under section 271B of the IT Act. The CIT (A) had confirmed the penalty amount. The Tribunal, considering the interconnected nature of the cases, remitted this appeal as well to the Assessing Officer for a fresh decision. This decision was made to afford the assessee an adequate opportunity in light of the remittance of the connected appeals.

Remittal of Appeals:
The Tribunal referred to a previous case involving Shri Manan Jain, where similar circumstances led to a remittance of the matter to the Assessing Officer for a fresh decision. Citing the similarities between the cases, the Tribunal decided to remit the appeals in question to the Assessing Officer for a fresh decision. This remittal was based on the need for a just decision in the interest of justice, ensuring that the assesses have a fair opportunity to present their case. Consequently, all three appeals were treated as allowed for statistical purposes, with the decision pronounced in open court on a specified date.