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TMI Blog2017 (6) TMI 918X X X X Extracts X X X X X X X X Extracts X X X X ..... ch case the Tribunal confirmed the addition made by the Assessing Officer holding that the assessee was not able to explain the genuiness of cash payment and was also unable to explain whether any unavoidable exceptional circumstances covered under Rule 6DD of the IT Rules. (iii) CIT(A) failed to observe that the Assessee was also unable to explain before the AO whether any unavoidable/ exceptional circumstances covered under Rule 6DD of the I.T'Rules, 1961. (iv) The CIT(A) erred in deleting the addition referring rule 6DD(j) which exempts the purview of sec. 40A(3) where the payment was required to be made on a day on which the banks were close, but the assessee has not sought any exemption stating that the cash payments were made on the day on which banks are closed. (v) CIT(A) erred in accepting the contention of the assessee relying on theerstwhile exemption clause (j) of Rule 6DD by which exemption from disallowance uls 40A(3) is available to tax payer once it is established that the payment could not be made by cross cheque or draft due to exceptional or unavoidable circumstances, since the clause (j) of rule 6DD has been omitted by the IT (fourteenth amendment) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... substantiated with necessary proof to the satisfaction of the AD to prove his claim that the credits in the current account are fixed deposits of earlier years. (ii) CIT(A) failed to appreciate that the onus of proving the source of credit in the current account in bank lies with the assessee and same has not been discharged by the assessee and hence treating the entire amount in the bank account was treated as unexplained in the hands of the assessee under Section 68 of the Act is justified. 2. Brief facts leading to this appeal are that assessee running a lodge and real estate business had file his return of income for the impugned assessment year disclosing income of B87,05,011/- The assessment was completed on 26.03.2013 u/s.143(3) r.w.s. 147 of the Income Tax Act, 1961 (in short ''the Act'') assessing the income at B1,81,40,652/- inter-alia making the following disallowance. 1 Land purchase under the head business income 42,94,062 2 Cash payment for land purchase under the head business income 21,75,000 3 Travelling expenses under the head business income 17,46,034 4 Expenses in respect of exempt income under the head other sources 10,00,000 5 Loan taken fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (3) of the Act as well as the disallowance of expenditure attributable to exempt dividend income claimed by the assessee which were made by the ld. Assessing Officer in the original assessment. He also deleted the further disallowance of B36,500/- under section 40A(3) of the Act and additions for credits in the current account made by the ld. Assessing Officer in the fresh assessment. 4. Now before us, ld. Departmental Representative strongly assailing the order of the ld. Commissioner of Income Tax (Appeals) submitted that aggregate cash payment of B22,11,500/- (B21,75,000/- made in the original assessment and B36,500/- made in the fresh assessment) for land purchase disallowed by the ld. Assessing Officer u/s.40A(3) of the Act was deleted by the ld. Commissioner of Income Tax (Appeals) citing a reason that the payments were genuine and made due to business expediency. As per ld. Departmental Representative ld. Commissioner of Income Tax (Appeals) had relied on clause (j) of 6DD of Income Tax Rules, which was not applicable, since assessee could not show that the payments were effected on a bank holiday. Further, as per ld. Departmental Representative ld. Commissioner of Income T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th total assessed income of B1,81,40,652/-. It has also been noted by the ld. Assessing Officer that the said order was set aside by the ld. Commissioner of Income Tax -1, Trichy invoking powers vested on him u/s.263 of the Act on 08.08.2014. However, ld. Assessing Officer started from the income of B1,81,40,652/- as originally assessed and made two further additions in the fresh assessment pursuant to the order u/s.263 of the Act. As mentioned by the ld. Authorised Representative the original assessment order was no more there when the fresh assessment pursuant to proceedings u/s.263 of the Act was taken up by the ld. Assessing Officer. Therefore, the ld. Assessing Officer could not have started from the income of B1,81,40,652/- originally assessed on 26.03.2013. He ought have started from the returned income of B87,05,011/-. Ld. Commissioner of Income Tax in our opinion having given a clear finding on these lines, ought not have adjudicated on the additions assailed by the assessee, which additions emanated from the original assessment. He should have confined himself to the additions made by the ld. Assessing Officer in his order dated 28.11.2014 which were B36,500/- u/s.40A(3) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . We had already held in relation to Revenue's appeal that original assessment having being set aside by the ld. CIT u/s.263 of the Act adjudication done by the ld. CIT(A) on the additions made by the ld. Assessing Officer in the original assessment were irrelevant. Hence, we are of the opinion that assessee has to succeed in its ground No. 2 & 3 of its cross appeal. 12. Ld. Authorised Representative did not advance any argument on his grounds 4 to 7. Grounds 4 to 7 of the cross appeal are dismissed. 13. In the result, the appeal of the Revenue for assessment year 2008-2009 is dismissed whereas cross appeal of the assessee is partly allowed. 14. Now we take up the appeal and cross objection for assessment year 2009-10. 15. For this assessment year also, facts are very similar to that for the preceding assessment year 2008-09. Original assessment done by the ld. Assessing Officer on 26.03.2013 was set aside by the ld. CIT invoking powers vested on him u/s.263 of the Act on 08.08.2014. In the subsequent assessment done by the ld. Assessing Officer pursuant to the order u/s.263 of the Act, he computed income of the assessee starting from the income assessed originally on 26.03.201 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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