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2014 (8) TMI 62 - AT - Income TaxAdmission of additional evidence Income from undisclosed sources Held that - AO could have easily realized that there was a prima facie mistake on the part of the Revenue to process the information received through the A.I.R - The A.I.R information was actually regarding the cash deposits through ABN Amro Bank - the cash deposits are small amounts on various dates - There is also cash withdrawal - assessee s claim is that cash deposits are out of sale proceeds received in cash and cash withdrawal are for making purchases from wholesalers and small manufactures AO without verify the matter proceeded to make an addition u/s 69 of the Act - CIT(A) has correctly analyzed the issue and reduced the addition - CIT(A) finding has not been controverted/dispelled by the Revenue order of the CIT(A) is upheld Decided against Revenue.
Issues:
1. Admission of additional evidence without giving opportunity to the Assessing Officer. 2. Deletion of addition of Rs. 13,48,700 out of total addition of Rs. 14,48,700 made by the Assessing Officer. Analysis: 1. The first issue revolves around the admission of additional evidence without providing an opportunity to the Assessing Officer to examine it. The CIT(A) admitted additional evidence and deleted the addition of Rs. 13,48,700 without giving sufficient opportunity to the Assessing Officer. The Revenue contended that the CIT(A) erred in admitting the evidence and not allowing the Assessing Officer to examine it. However, the appellant argued that no fresh evidence was presented before the CIT(A). The Tribunal observed that the Assessing Officer should have realized the mistake made by the Revenue in processing the information received through A.I.R. The A.I.R information pertained to cash deposits through ABN Amro Bank, not credit card expenditure. The Tribunal found that the CIT(A) correctly analyzed the issue and reduced the addition from Rs. 14,48,700 to Rs. 1,00,000. The Tribunal upheld the CIT(A)'s decision as the Revenue failed to counter the findings. Therefore, the Tribunal dismissed the appeal of the Revenue. 2. The second issue concerns the deletion of the addition of Rs. 13,48,700 out of the total addition of Rs. 14,48,700 made by the Assessing Officer. The CIT(A) allowed the appeal of the assessee after considering the submissions and evidence. The CIT(A) noted that the Assessing Officer did not collect evidence to prove that the assessee had incurred the expenditure through his credit card. The CIT(A) observed that the A.I.R information was related to cash deposits, not credit card expenses. After analyzing the bank statements and considering the small business turnover of the assessee, the CIT(A) confirmed an estimated addition of Rs. 1,00,000 and deleted the balance addition of Rs. 13,48,700. The Revenue challenged this decision, arguing that the deletion was unwarranted. However, the Tribunal upheld the CIT(A)'s decision, emphasizing that the Assessing Officer failed to verify the matter before making the addition under section 69 of the Act. The Tribunal found no reason to interfere with the CIT(A)'s findings and dismissed the appeal of the Revenue. In conclusion, the Tribunal upheld the CIT(A)'s decision to delete the addition of Rs. 13,48,700, emphasizing the lack of evidence and verification by the Assessing Officer. The Tribunal also dismissed the Revenue's appeal, highlighting the correct analysis conducted by the CIT(A) and the absence of rebuttal to the findings presented.
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