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TMI Blog2021 (2) TMI 663X X X X Extracts X X X X X X X X Extracts X X X X ..... oceedings against the HUF by issuance of notice under section 142 (1) of the Act to make substantive addition in the hands of the HUF, and no such notice under section 142 (1) of the Act was issued by the learned Assessing Officer, as admitted by the assessing officer in his remand report, the endeavour of the Ld. CIT(A) should be to allow the assessee to prove his contention with reference to the document, instead of proceeding with the matter and to hold that the receipt is taxable in the hands of the assessee basing on certain circumstances. When the assessee offered the direct evidence, findings of the authorities below basing on the circumstances does not appear to be proper, inasmuch as the endeavour of the authorities under the Incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Infrastructure Pvt. Ltd.) and also a coparcener in Suraj S.J. Bahadur HUF Orchards. For the AY 2009-10 he has filed the return of income on 29.03.2011 declaring income of ₹ 1,08,00,000/-. AO received information through AIR, that there is cash deposit of ₹ 23,34,400/- in the bank account of the assessee. Assessee was asked to provide details of cash deposit of ₹ 23,34,400/- in his saving bank A/c for which Annual Information Return was received. Assessee, vide letter dated 15.12.11, submitted copies of his bank statements and also submitted the details of cash receipts of ₹ 25 lakhs which he claimed to have received on behalf of Suraj S.J. Bahadur (HUF). On being asked to explain the nature of transaction between him ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pts from the sale proceeds of timber by HUF i.e. Suraj S.J. Bahadur (HUF) has been deposited in his son s account who is the coparcener in HUF. AO, however, observed that in this confirmation letter Karta of HUF has nowhere stated that Shri Uday Bahadur will be the sole owner of this amount i.e. ₹ 25 lakhs and can use it as he like and that he has only declared about the deposit of the sale proceed in Shri Udav Bahadur s account and has not given any power of attorney to Shri Udav Bahadur to manage the affairs of HUF as has been claimed by Shri Udav Bahadur in his submissions. AO further observed that the assessee also submitted a copy of Agreement vide letter dated 15.12.11 for sale of Timber and Foliage between Shri Kashmira Singh, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtinent to note that in the light of the submissions made and material produced by the assessee, in support of his contention that the receipt belongs to the HUF, but to him individually, AO, in his order stated that i n order to protect the interest of the Revenue, notice u/s 142(1) of the Income Tax Act, 1961, was issued to the Suraj S.J. Bahadur (HUF) to file its return of income because the HUF has not been filing its return of income by treating receipt of ₹ 25 lakhs as agricultural income and protective assessment is made in this case in the hands of Shri Uday Bahadur to tax non-agricultural income as per the provisions of the Act till a substantive assessment is made in the hands of HUF after submission of return of income by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come and having made the protective assessment in the hands of assessee to tax non-agricultural income as per the provisions of the Act till a substantive assessment is made in the hands of HUF after submission of return of income by HUF, AO failed to take the issue to the logical conclusion by taking steps against the HUF and because of the absence of the substantive assessment anywhere, the protective assessment cannot be sustained. Secondly that when the AO realized that there was need of only protective assessment in the hands of assessee whereas the substantive assessment has to be made in the hands of HUF, the authorities below are not justified in preventing the assessee from producing the evidence to show that the receipt in fact pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e reason why protective assessment is made in the hands of the assessee. 10. It is clear from the record that having considered the plea of the assessee in the light of the material produced by him, learned Assessing Officer thought it fit to issue notice under section 142 (1) of the Act in respect of SJ Bahadur HUF and till such time the substantive addition is made in the hands of the HUF, learned Assessing Officer made protective addition in the hands of the assessee. In such an event, there is no reason as to why the learned Assessing Officer had not taken the things to their logical conclusion by making necessary enquiries as to the nature of the receipt vis a vis the HUF and also why the request of the assessee to permit him to pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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