2023 (4) TMI 134 - AT - Income Tax

Addition on account of declaration in IDS - assessee was not eligible for declaring in IDS, 2016 and appellant failed to provide explanation for source of said income disregarding the submissions given by the appellant - At the time of hearing, the ld. A.R for the assessee contended that they wish to file certain additional evidences - HELD THAT - The orders of the subordinate authorities, the submissions of the parties and the additional evidences filed, we are of the considered view, in the interest of justice, these evidences may be admitted and the matter be remanded back to the file of the ld. A.O for re-adjudication as per law while complying with the principles of natural justice. In view thereof we set aside the order of the ld. CIT (A) and restore the matter to the file of the ld. A.O accordingly. Grounds of appeal of the assessee are allowed for statistical purposes.

Issues:
1. Addition of income under Income Declaration Scheme (IDS) 2016
2. Charging of interest under section 234B of the Income Tax Act
3. Condonation of delay in filing the appeal

Issue 1: Addition of income under Income Declaration Scheme (IDS) 2016
The appellant contested the addition of Rs.23,00,000 on the grounds that the assessing officer erred in making the addition as the appellant had filed a revised statement incorporating the additional income before the DDIT(Inv.) and paid taxes along with interest, proving a bona fide intention. The appellant argued that once an amount is declared under IDS 2016 and accepted by the PCIT, Central, no addition can be made in regular assessment. However, the CIT(A) upheld the assessing officer's decision, stating that the appellant failed to provide evidence that the cash deposit of Rs.23,00,000 was from business proceeds. During the hearing, the appellant sought to submit additional evidence, including IDS Form No. 4 dated 12-02-2020, which was not previously available to the department. The Tribunal admitted the additional evidence and remanded the matter back to the assessing officer for re-adjudication, emphasizing compliance with natural justice principles.

Issue 2: Charging of interest under section 234B of the Income Tax Act
The appellant challenged the charging of interest under section 234B of the Income Tax Act on the assessed income, arguing that interest should be levied on the tax on the total income declared in the return. The Tribunal did not delve deeply into this issue in the judgment, as the primary focus was on the addition of income under IDS 2016. However, the Tribunal's decision to remand the matter back to the assessing officer for re-adjudication implies that the issue of charging interest under section 234B may be re-evaluated during the reassessment process.

Issue 3: Condonation of delay in filing the appeal
The appeal was found to be time-barred by 888 days, but the appellant filed a condonation of delay petition citing circumstantial reasons, including the impact of the Covid-19 pandemic, for the delay. The Tribunal, after considering the reasons presented and finding no deliberate misconduct or malafide intention on the part of the appellant, condoned the delay and proceeded to hear the appeal on merits. The decision to condone the delay allowed the appellant's case to be considered despite the significant delay in filing the appeal.

In conclusion, the judgment addressed the issues related to the addition of income under IDS 2016, the charging of interest under section 234B of the Income Tax Act, and the condonation of delay in filing the appeal. The Tribunal remanded the matter back to the assessing officer for re-adjudication based on the admission of additional evidence by the appellant. The decision to allow the appeal for statistical purposes indicates that further examination and re-evaluation of the issues will take place during the reassessment process.

← Previous Next →