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TMI Blog2020 (7) TMI 365X X X X Extracts X X X X X X X X Extracts X X X X ..... dentity and genuineness of the transaction is proved. Since the identity and genuineness is proved and the relationship between the donor and donee is also proved, I am convinced that the assessee has been able to explain the sources of investment. The assessee has shown ₹ 1 lakh as her own earnings which is not accepted by the department without any basis find that the assessee being the wife of a Defense Personnel, could not be said to not to have the savings of ₹ 1 Lakh. Therefore, the entire addition of ₹ 13 lakhs is deleted. The grounds of appeal of assessee on this issue are allowed. - Appeal decided partly in favour of assessee. - ITA No. 951/Hyd./2019 - - - Dated:- 11-6-2020 - Smt. P. Madhavi Devi, Judicial Member For the Assessee : Shri G.Kalyan Das, A.R. For the Revenue : Sh. Kiran Katta, D.R. ORDER This is assessee s appeal against the order of Ld.CIT(A)-7, Hyderabad dated 22.03.2019 for A.Y. 2010-11. The assessee has raised the following grounds of appeal. 1. The Order of the Ld.CIT(A) is contrary to the law and the facts. 2. The ld.CIT(A) erred in making the addition of ₹ 12.00 Lakhs received from the Bank Account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he impugned addition. 13. The ld. AO thus erred in initiating the Proceedings u/s. 147 of the Act and in making addition of ₹ 15.48 Lakhs in a routine manner without application of the facts and the evidence on record. 14. The ld. AO therefore ought to have noted that Proceedings initiated for Assessment u/s. 147 of the Act based on conjectures, suspicion and guesswork without any evidence or material on record is bad in law and the order requires to be annulled/vacated. 15. For these and other grounds that may be urged before the disposal of the appeal, Assessment Order be held as bad in law and the order be quashed. 1.1. At the outset, it is noticed that there is a delay of 12 days in filing the appeal before the Tribunal. The assessee has explained that the delay of 12 days had occurred as the assessee was consulting its auditors about filing of the appeal before the Tribunal and that the delay is bonafide and beyond the control of the assessee. 1.2. The Ld.DR was also heard. 1.3. I find the reasons mentioned for the delay to be reasonable and therefore, the delay in filing the appeal is condoned. 2. Brief facts of the case are that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of her hard earned savings and in total an amount of ₹ 13 lakhs was transferred to her stock broker for trading in securities. In proof of receiving the amount from her brother, the assessee also filed the certificate of the bank. It was also submitted that out of this fund of ₹ 13 lakhs only, buying and selling of shares has taken place and assessee had in fact incurred loss of ₹ 15,48,151/- from the said business and prayed for deletion of addition made by AO. The CIT(A) considered submissions of the assessee and also examined the evidences filed by assessee and accepted that there is short term capital loss of ₹ 15,48,151/- Accordingly he directed the AO to accept the short term capital loss as declared by assessee in the return of income. With regard to source of investments of ₹ 13 lakhs, the CIT(A) did not accept the sources both to the extent of ₹ 1,00,000/- being asssessee s own savings, and also the balance of ₹ 12 lakhs. The CIT(A) observed that there is no confirmation from donor Sri Annd Srinivas and also that there is no proof of assessee s own savings. He therefore held that this is required to be added to the returned lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R, on the other hand, supported the order of the AO and submitted that the AO had received information that the assessee has made transactions worth ₹ 43,96,84,412/- and there was sufficient material before him to believe that there is escapement of income since the assessee had not filed her return of income. He submitted that since turnover of the assessee was more than ₹ 40 lakhs, the tax audit report was mandatory and since there was no such report also, the AO had reason to believe that there is escapement of income and hence AO had reopened the assessment to verify the sources of investment and the income from the share transactions and hence there is no infirmity in the reopening of the assessment. He submitted that the loss declared by the assessee in her return of income has been brought to tax as unexplained investment only and therefore, the addition has to be sustained. 10. Having regard to rival contentions and material placed on record, I find that the assessee had turnover of more than ₹ 40 lakhs, but she had not filed the return of income along with the tax audit report. Therefore, the AO was reasonable in believing that there was escapement of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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