TMI Blog2020 (1) TMI 772X X X X Extracts X X X X X X X X Extracts X X X X ..... g the course of appellate hearing, the ld. AR also brought to our attention that not only the SLP preferred by the Revenue has been dismissed by the Hon ble Supreme Court [ 2019 (7) TMI 351 - SC ORDER] but even the review petition filed by the Department before the Hon ble Delhi High Court was dismissed. For the reasons set out in foregoing therefore we find no reason to interfere with the order of the Ld. CIT(A). Addition u/s 68 - CIT-A deleted addition on admission of additional evidence - violation of Rule 46A - HELD THAT:- DR was unable to pin point what additional evidence was produced by the assessee before the Ld. CIT(A) which influenced his decision. CIT, DR did not bring to our attention any particular document, which in his opinion constituted fresh or new evidence within the ambit of Rule 46A. Remand report was called for prior to adjudication of the appeal and in that view of the matter it was imperative for the Revenue to point out the specific document or evidence which was in the nature of additional evidence, not available with the AO. In the remand report the AO admitted that the explanation put forth in appeal was also made in the course of assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Respondent : Shri D. S. Damle, FCA ORDER PER SHRI A.T.VARKEY, JM Both these appeals preferred by the assessee is against the separate orders of the Ld. CIT(A)-21, Kolkata dated 28.02.2018 for AY 2005-06 and 2006-07. 2. First we take up the appeal of the revenue for AY 2005-06. The revenue has raised the following grounds of appeal: 1. That on the facts and in the circumstances of the case, Ld. CIT(A) has erred in holding that the notice issued u/s. 148 of the I. T. Act, 1961 on 19.08.2013 for AY 2005-06 was barred by limitation without appreciating the fact that assessee had bank deposits in a foreign country and in that case, sixteen years from the end of the relevant assessment year is the time limit for reopening assessment as per section 149(1)(c) of the I. T. Act. 2.That the Ld. CIT(A) has erred in law by saying that as per the Finance Act, 2012 as enacted by the Parliament, Section 149(1)(c) was made effective prospectively from 01.07.2012 and thereby also has erred in law by observing that there was nothing expressly provided by the amending Act, which indicate Le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dge of her late husband. Thereafter she procured a bank statement relating to the bank account and a copy of the same had been submitted to the department on 19.02.2013 showing the said account was in the name of her late husband as first holder and herself as the second holder. The said statement recorded all transactions since inception of the account opened on 03.08.2004 till closure of the same on 24.02.2009 the entire period being during the lifetime of late Lalit Mohanka, who expired on 07.10.2009. So, according to AO the entire income was chargeable in the hands of late Lalit Mohanka, and thereafter on his demise, on his estate represented by the legal representative in terms of sec. 159 of the Act. According to AO, the bank account statement indicated that the same was opened on 06.08.2004 and that an aggregate amount of ₹ 83,70,274.48 had been deposited into the said bank account during the year under consideration. It was also noted that the said deposit were not reflected in the balance sheet of the assessee and not offered to tax as income for the year in his return of income. In view of the above, the AO issued notice u/s. 148 on 19.08.2013 seeking to reopen the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equent to search, proceedings under Chapter XIV of the Act were initiated by the Ld. AO for the AY 2006-07 and onwards. On receipt of the relevant bank statements, the Ld. AO noted that the said bank account was opened and the deposits in the said bank account were first made by Shri Mohanka in FY 2004-05 being previous year relevant to the AY 2005-06. Since the said assessment year did not come within the ambit of provisions of Section 153C, the Ld. AO issued a notice u/s 148 dated 19.08.2013 after recording the reasons to believe for reopening of assessment. 2. The appellant per se did not object to the facts stated in the recorded reasons but objected to the initiation of the reassessment proceedings u/s 147 on the ground that provisions of Section 149 did not permit the Ld. AO to reopen the assessment for the AY 2005-06 since the proceedings for the relevant year had become time barred on 31.03.2012 whereas the reassessment proceedings In the were initiated only on 19.08.2013 I.e. after the proceedings had become time barred. In the course of appellate proceedings the Ld. AR of the appellant made extensive arguments claiming that in terms o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions came in force with effect from 01.07.2012. I therefore note that the amending Act being Finance Act, 2012 by which clause (c) was enacted and inserted in Section 149(1), particularly prescribed that the amending law came into effect on 01.07.2012 and there was nothing in the amending Act which indicated the Legislative intent to make the said provision operative retrospectively. In this regard the Ld. AR of the appellant brought to my attention the provisions of Finance Bill, 2012 by which amendments were proposed to be made in the Income-tax Act, 1961 to amend several Sections with retrospective effect. For example, the Sections 2(14) 2(47) defining the expressions 'capital asset' 'transfer' were amended and the amended provisions were made effective retrospectively from 01.04.1962. Similarly amendments were carried out In Section 9(1)(vi) 9(1)(vii) enlarging the definition of income deemed to accrue in India by way of 'royalty' and 'fees for technical services' and the amendments were made effective retrospectively from 01.04.1976. Unlike, the foregoing amendments which were specifically made effective retrospectively, the amendment in S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. The issue for consideration by the Hon'ble Supreme Court in that case was similar to the one involved in the present case. In that case the assessee had claimed that his assessment was reopened by the Ld. AO by taking benefit of the extended period of limitation which was provided for in Section 148 under the 1961 Act whereas the period of limitation under the 1922 Act had already expired. It was assessee's contention that even though the period of limitation for reopening of assessment was expanded in Section 148 of the 1961 Act, the said provision did not revive the assessment which had already become time barred before the amended provisions of Section 148 of the Income-tax Act, 1961 came into force. In that case the income- tax assessment of the assessee for AY 1947-48 was made by the Ld. AO on 31.01.1952. Thereafter the Ld. AO issued a notice dated 27.03.1956 under Section34(1)(a) of the Income-tax Act, 1922 and served it by affixture. The Ld. AO completed the assessment on 29.02.1957 against which the appeal was filed by the assessee. The AAC allowed the appeal and set aside the assessment order on the ground that there was no valid service of notice. The order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acquired or to any remedy already lost by efflux of time. The language of the new section must be read as applicable only to those cases where the right of the ITO to reopen the assessment was not barred under the repealed section, The new statute does not disclose in express terms or by necessary implication that there was a revival of the right of the ITO to reopen an assessment which was already barred under the old Act. It must be held that, on a proper construction of section 297(2)(d )(ii) of the new Act, the ITO could not Issue a notice under section 148 in order to reopen the assessment of an assessee in a case where the right to reopen the assessment was barred under the old Act at the date when the new Act came into force. It followed, therefore, that the notices dated 13-11-1963 and 9-1-1964, issued by the ITO, were illegal and ultra vires and were rightly quashed by the High Court by the grant of a writ. The appeal was dismissed and decision of High Court affirmed. 8. The judgment of the Supreme Court in the case of S.S. Gadgil Vs Lal Co. (50 ITR 231) is also relevant in deciding this issue. In that case while completing the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt proceedings on 27.03.1957 only if the amended Section was applicable and not otherwise. According to Court however the amendment Act came in force with effect from 01.04.1956 and prior to that date the period earlier provided for issue of once u/s 34 had expired. In the opinion of the Court, there was no over-lapping period and therefore there was no scope for issuing notice under the amended Section 34 which extended the period of limitation. 9, I also note that the Supreme Court had occasion to consider the scope of amended limitation period in the revenue proceedings in the case of Union of India Vs Uttam Steels Ltd (319 ELT 598), In this case the assessee was carrying on business of manufacture export of galvanized corrugated sheets. The company had effected export shipments on 25.5.1999 10.06.1999, In respect of such exports, under Section 116 of the Central Excise Act, 1944; the company could have furnished its claim for rebate within six months from the dates of shipment. The company however filed its claim on 28.12.1999 which was beyond the period prescribed in Section 116 of the relevant Act. Subsequent to filing of claim, the Finance Act, 2000 am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there has been no determinable point of time between the expiry of the time provided under the old Act and the commencement of the amending Act. The legislature has given to section 1.8 of the finance act, 1956, only a limited retrospective operation i.e. up to 1- 4-1956, only. That provision must be read subject to the rule that In the absence of an express provision or clear Implication, the legislature does not intend to attribute to the amending provision a greater retrospectivity than is expressly mentioned, nor to authorise the Income Tax Officer to commence proceedings which before the new Act came Into force had by the expiry of the period provided, become barred. 10.2 To similar effect Is the judgment in ITO v. InduprasadDevshanker Bhatt AIR 1969 SC 778. The Court held: (AIR p. 783, para 6) 6. In our opinion, the principle of this decision applies in the present case and it must be held that on a proper construction of section 297(2)(d)(II) of the new act, the Income Tax Officer cannot issue a notice under Section 148 In order to reopen the assessment of an assessee In a case where the right to reopen the assessment was barred unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded period of one year on the subsequent to Section 11-B. 12. The effect of Section 11-8, and in particular, applications for rebate being made within time, has been laid down in Mafatlal Industries Ltd. v. Union of India 1997 5 SCC 536, thus: (SCC pp. 631-32, para 108) 10B. The discussion in the judgment yields the following propositions. We may forewarn that these propositions are set out merely for the sake of convenient reference and are not supposed to be exhaustive. In case of any doubt or ambiguity in these propositions, reference must be had to the discussion and propositions in the body of the judgment. (i) Where a refund of tax/duty is claimed on the ground that it has been collected from the petitioner/plaintiff-whether before the commencement of the Central Excises and Customs Laws (Amendment) Act, 1991 or thereafter-by misinterpreting or misapplying the provisions of the central excises and salt act, 1944 read with central excise tariff act, 1985 or customs act, 1962 read with customs tariff act or by misinterpreting or misapplying any of the rules, regulations or notifications issued under the said enactments, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cutta High Court in the case of CIT Vs Manik Chand Nahata (78 ITR 204) wherein the Court held as follows: It was not disputed that unless the escaped income amounted to rupees one lakh or more, the ITO would have no right to reopen the proceedings under the 1922 Act beyond the expiry of eight years from the relevant assessment year. The expression 'likely to amount to , means that the ITO must form some kind of belief or even a suspicion before the notice under section 34 of 1922 Act is issued that the amount of escaped income for the year or any other year may amount to rupees one lakh or more In the aggregate. The satisfaction or belief or suspicion must necessarily be tentative because after the final adjudication it may be found that no income had escaped assessment at all. This is the context and background in which the expression 'likely to amount' is to be construed. In the Instant case, there was no material to hold that the amount of escaped Income was likely to exceed rupees one lakh. Consequently, since the right to reopen the proceedings was barred under the 1922 Act before the 1961 Act came into forc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en years became available for AYs 2006-07 and onwards and In such sense, the amendment was retro-active In operation. As per the principle laid down in the judgments cited above, I however find that the assessments for and upto AY 2005-06 had become time barred as on 31.03.2012. Section 149(1)(c) came into forceonly effective from 01.07.2012 and as such there was no overlapping period. In the circumstances therefore the proceedings u/s 147 which became time barred prior to 1st July 2012, could not be revived by the amendment in Section 149(1)(c). I am therefore of the considered opinion that since in the present case, the assessment was reopened by the Ld. AO only on 19.08.2013, the same was barred by limitation. Accordingly I hold that the proceedings were without jurisdiction and consequently therefore the assessment order passed u/s 147 was ab initio void. The order u/s 147/143(3) dated 19.01.2015 is therefore cancelled. Ground No. 2 is therefore allowed. 5. Aggrieved by the aforesaid order, the revenue is now in appeal before us. 6. Assailing the decision of the Ld. CIT(A) the Ld. CIT, DR made oral as well as written submissions. For the sake ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e new Section 149(1)(c) became operational by the enactment of Finance Act, 2012. The Ld. CIT(A) relied on the decision of the Hon'ble Apex Court in J. P. Jani ITO vs Induprasad D Bhatt (72 ITR 595). However, in my opinion, this was the case where the Department reopened a case under the Income Tax Act, 1961 for AY 47-48 where the case was already barred by limitation under the old Income Tax Act,1922, being repelled. The Hon'ble Apex Court decided in favour of the assessee by interpreting the Section 297(2)(d)(ii) which specifically deals with reopening of assessments under the Income Tax Act, 1961 vis-a-vis such proceedings under the repelled The India Income Tax Act, 1922. In my opinion, this decision cannot be applied in this present case as the fact of the case is entirely different than the case referred in J.P. Jani ITO vs Induprasad 0 Bhatt (72 ITR 595). In this present case, the interpretation of Section 297(2)(d)(ii) is not relevant as this reopening has no nexus with the old and repelled The India Income Tax Act, 1922 requiring interpretation of the construction of Section 297(2)(d)(ii) of the Income Tax Act, 1961. The rest o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (3) of this section as amended by the Finance Act, 2012, shall also be applicable to the proceedings initiated under this section for any assessment year beginning on or before 1st April, 2012. Therefore, the decision relied by the respondent assessee are not relevant in as much as, no writ petition was filed against the issue of notice u/s. 148 in the instant case. On the other hand, the intention of the parliament cannot be overlooked and escapement of foreign asset under taxation. 7. Per contra, the ld. AR fully relied on the order of the Ld. CIT(A). He further drew our attention to the decision of this Tribunal in the case of DCIT Vs Sri Biswanath Garodia in ITA Nos.1672 to 1674/Kol/2018 dated 08.11.2019 wherein identical issue was involved and this Tribunal upheld the order of Ld. CIT(A) holding the proceedings initiated u/s 148/147 in respect of AYs 2005-06 and earlier, after 1st April 2012 to be time barred. 8. We have heard rival submissions and have perused the material available on record. On perusal of the decision of this Tribunal in the case of Shri Bishwanath Garodia (supra), we find that not on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore the end of six years from the end of the relevant assessment year and not beyond. Accordingly the proceedings under Section 147 for the AY 2001-02 could not have been initiated anytime on or after 01-04-2008. In so far as AY 2005-06, no proceedings under Section 147 could have been initiated on or after 01-04- 2012. We thus find that when clause (c) of Section 149(1) became operational on 01-07- 2012, the reassessment proceedings, as per the law then existing had already become time barred or dead. As such as per the provisions of the Act as on force on 31-03-2012, the assessee had obtained a vested right, as provided by Section 149(1). From the language employed by the Legislature while enacting clause (c) in Section 149(1), we find that legislative mind to make the said provision applicable retrospectively so as to revive proceedings which had already become time barred, is nowhere discernible. Nowhere either in the amendment Act or in Notes on Clauses, it is apparent that the Parliament while enacting clause (c) in Section 149(1) intended to bestow on the tax authorities powers to revive the proceedings which had already become dead at the time when the amended provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m 01-07-2012. Nowhere in the language used by the Parliament, it disclosed its mind that the said provision was intended to revive or reopen the proceedings which had attained finality prior to the date on which the amended provision came into operation. In the circumstances in absence of any clear mandate by the Parliament, the Revenue cannot press into service the provisions of the Explanation to claim that even the proceedings which had attained finality or where the proceedings u/s 147 had become time barred, the same stood revived because of the Explanation. 15. We find that in the impugned order the ld. CIT(A) relied on the decision of the Hon ble Supreme Court in the case of J.P. Jani ITO Vs Induprasad D. Bhatt (supra). In the decided case the assessee had claimed that his assessment was reopened by the Ld. AO by taking benefit of the extended period of limitation which was provided for in Section 148 under the 1961 Act whereas the period of limitation under the 1922 Act had already expired. It was assessee s contention that even though the period of limitation for reopening of assessment was expanded in Section 148 of the 1961 Act, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of Section 11B of the Central Excise Act, 1944 which granted additional time for preferring refund claim should be made available to the assessee even though within the original limitation period the assessee had failed to furnish such claim and the time limit for making such claim had expired prior to the amending Act becoming operational. The assessee s plea for extension of limitation period was resisted by the Revenue but was allowed by the Hon ble High Court. On appeal by the Revenue, the Hon ble Supreme Court held as follows: 10. We have heard the learned counsel for the parties and Shri Bagaria, the learned amicus curiae at some length. There is no doubt whatsoever that a period of limitation being procedural or adjectival law would ordinarily be retrospective in nature. This, however, is with one proviso super added which is that the claim made under the amended provision should not itself have been a dead claim in the sense that it was time-barred before an amending Act with a larger period of limitation comes into force. A number of judgments of this Court have recognised the aforesaid proposition: 10.1 Thus, in S.S Gadgil v. Lal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0.3 In New India Insurance Co. Ltd v. Smt Shanti Misra, Adult 1975 2 SCC 840, this Court said: (SCC p. 846, para 7) 7. (2) The new law of limitation providing a longer period cannot revive a dead remedy. Nor can it suddenly extinguish vested right of action by providing for a shorter period of limitation. 10.4 Similarly in T. Kaliamurthi v. Five Gori ThaikkalWakf 2008 9 SCC 306, this Court said: (SCC p. 322, para 40) 40. In this background, let us now see whether this section has any retrospective effect. It is well settled that no statute shall be construed to have a retrospective operation until its language is such that would require such conclusion. The exception to this rule is enactments dealing with procedure. This would mean that the law of limitation, being a procedural law, is retrospective in operation in the sense that it will also apply to proceedings pending at the time of the enactment as also to proceedings commenced thereafter, notwithstanding that the cause of action may have arisen before the new provisions came into force. However, it must be noted that there is an important exception to this rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n current activities. Law passed today cannot apply to the events of the past. If we do something today, we do it keeping in view the law of today and in force and not tomorrow's backward adjustment of it. Our belief in the nature of the law is founded on the bed rock that every human being is entitled to arrange his affairs by relying on the existing law and should not find that his plans have been retrospectively upset. This principle of law is known as lexprospicit non respicit : law looks forward not backward. As was observed in Phillips v. Eyre [1870] LR 6 QB 1, a retrospective legislation is contrary to the general principle that legislation by which the conduct of mankind is to be regulated when introduced for the first time to deal with future acts ought not to change the character of past transactions carried on upon the faith of the then existing law. 32. The obvious basis of the principle against retrospectivity is the principle of 'fairness', which must be the basis of every legal rule as was observed in the decision in L'OfficeCherifien des Phosphates v. Yamashita-Shinnihon Steamship Co. Ltd. [1994] 1 AC 486. Thus, legislations which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... normal rule of presumption against retrospective operation. Thus, the rule against retrospective operation is a fundamental rule of law that no statute shall be construed to have a retrospective operation unless such a construction appears very clearly in the terms of the Act, or arises by necessary and distinct implication. Dogmatically framed, the rule is no more than a presumption, and thus could be displaced by out weighing factors 18. The Hon ble Supreme Court while adjudicating the matter also took note of the fact that the same Finance Act, 2002 carried out some other amendments to the Income-tax Act, 1961 which were given retrospective operation by the Parliament. However the proviso to Section 113, was made effective prospectively from 01-06-2002. The relevant discussion in the said judgment is as follows: d) There are some other circumstances which reflect the legislative intent. The problem which was highlighted in the Conference of Chief Commissioners on the rate of surcharge applicable is noted above. In view of the aforesaid difficulties pointed out by the Chief Commissioners in their Conference, it becomes clear that as per the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esent case we note that the Finance Act, 2012, by which clause (c) was enacted in Section 149(1), also made several other amendments in the Income-tax Act, 1961 and these were made applicable with retrospective effect. For instance, Sections 2(14) 2(47) which define the words capital asset transfer were amended with retrospective effect from 01-04-1962. Similarly amendments in Section 9(1)(vi) 9(1)(vii) enlarging the definition of income deemed to accrue in India by way of royalty and fees for technical services were made effective retrospectively from 01-04-1976. These amendments were also closely linked with foreign sources of income or transactions between the non-residents. However the Legislature in its wisdom made the foregoing amendments with retrospective effect, whereas the amendment in Section 149(1) by inserting clause (c) was made effective prospectively from 01-07-2012. We therefore find merit in the ld. AR s submission that legislative intent to make the clause (c) of Section 149(1) applicable retrospectively so as to revive close proceedings was not apparent. 20. Before us, the ld. AR bolstered his argument by makin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... governing Act or as per terms of Section 115JB of the Act. Secondly, by virtue of this explanation if an anomaly which we have noticed is sought to be removed, we do not think that the legislature has achieved such purpose. In plain terms, this is not a case of retrospective legislative amendment. It is stated to be clarificatory amendment for removal of doubts. When the plain language of sub-section (2) of Section 115JB did not permit any ambiguity, we do not think the legislature by introducing a clarificatory or declaratory amendment cure a defect without resorting to retrospective amendment, which in the present case has admittedly not been done. 21. We note that the language of Explanation (3) to Section 115JB is somewhat similar to the language of the Explanation below Section 149. In both places it is provided that the Explanation is inserted for removal of doubts and the Explanation is applicable to assessment years beginning on or before 01-04-2012. Yet the Hon ble Bombay High Court held that since the principal provision of the Act was not amended retrospectively, by applying the Explanation (3), the principal provisions of Section 115JB cannot be mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C), examined the validity of the retrospective amendment of a statute in light of Article 19(1)(g) of the Constitution of India, i.e. a fundamental right to practice any profession, or to carry on any occupation, trade or business. The court said: In testing whether a retrospective imposition of a tax operates so harshly as to violate fundamental rights under article 19(1)(g), the factors considered relevant include the context in which retroactivity was contemplated such as whether the law is one of validation of taxing statute struck-down by courts for certain defects; the period of such retroactivity, and the decree and extent of any unforeseen or unforeseeable financial burden imposed for the past period etc. 18. In Govinddas v. ITO [1976] 103 ITR 123 the Supreme Court held that Section 171 (6) of the Income Tax Act was prospective and inapplicable for any assessment year prior to 1st April, 1962, the date on which the Act came into force and observed that: 11. Now it is a well settled rule of interpretation hallowed by time and sanctified by judicial decisions that, unless the terms of a statute expressly so provide o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ravichandra V Mehta Vs DCIT in ITA Nos.409, 450, 410 and 451/Rjt/2017 dated 25-02- 2019 25. Respectfully following the decisions cited above and for the reasons discussed in the foregoing, we therefore do not see any reason to interfere with the orders of the ld. CIT(A) for the AYs 2001-02 to 2005-06. 9. Since the issue involved in the present appeal and applicable legal provisions governing the same in the assessee s case being identical with the above decision (supra), we have no hesitation in holding that the ld. CIT(A) was justified in holding that the notice dated 19.08.2013issued u/s 148 in respect of AY 2005-06 was time barred and consequently therefore the order dated 19.01.2015 passed by the AO being ab initio void was therefore rightly cancelled. We also note that the decision of this Tribunal is in consonance with the decision of the Hon ble Delhi High Court in the case of BrahmDatt Vs UOI (supra). During the course of appellate hearing, the ld. AR also brought to our attention that not only the SLP preferred by the Revenue has been dismissed by the Hon ble Supreme Court but even the review petition filed by the Department before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the relevant provisions of the Act. In these grounds the primary objection of the Ld. AR of the appellant is that the sum of $ 105,000 brought to tax by the Ld. AO was neither deposited in nor Invested through the foreign bank account in the relevant financial year 2005-06 and therefore the Impugned addition of Rs,46,84,050/- was unsustainable. The Ld. AO in the assessment order has taxed the credit entry of $105,000 which is reflected in the bank statement on 31.03.2006, as unexplained income of the appellant. The appellant has however contended that the credit of $105,000 reflected in the bank statement on 31.03.2006 does not represent any fresh deposit or new investment in the foreign bank account made in the year under appeal. The appellant placed on record the copy of bank statement for FY 2004-05 which inter alia contained debit entry on 07.12.2004 evidencing that sum of $105,000 was invested in 'Italy 2.5%'. The appellant contended that it was this very investment 'Italy 2.5%' which stood redeemed in the relevant year under consideration and the redemption proceeds was credited In the same bank account on 31.03.2006 under the narration, RE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o ₹ 46,84,050/-) as unexplained income of the appellant. 4. From the entries in the bank account, it is noted that the account was opened on 03.08.2004 with 'NIL' balance. On 02.12.2004 there was a deposit of $1,10,133.25 (equivalent to ₹ 48,70,092). On 07.12.2004 a debit entry of $ 105,285.05 was reflected in the bank statement under the narration P: 105000: Italy:2.5%.31.03.2006:99357 . The entry suggested that an investment of $105,000 was made out of the deposit made on 02.12.2004 and that the same was redeemable on 31.03.2006. On 31.03.2006, the redemption proceeds of $ 105,000 was credited in the appellant's bank account under the narration, REDM: 105000: ITALY 2.5% 31.3.06 : 100,0 . The Ld. AO In his remand report although admitted that the credit on 31.03.2006 appeared to have relation with the debit entry on 07.12.2004 but since the appellant was unable to fully substantiate the same he was not in a position to accept the submission of the appellant at its face value. The Ld. AO has enlisted three factors justifying the addition. 5. The first factor according to the Ld. AO is that the appellant was unable to f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned addition, of Rs,46,84,050/- as unexplained income of the appellant for the relevant AY 2006-07 was misconceived and unjustified. The Ld. AO is directed to delete the aforesaid addition. These grounds of appeal therefore stand allowed. 12. Aggrieved by the aforesaid order, the revenue is now in appeal before us. At the time of hearing the Ld. CIT, DR relied on the AO s order. He further claimed that the Ld. CIT(A) was unjustified in granting relief to the assessee by admitting additional evidence in violation of Rule 46A of the Income Tax Rules, 1962 [ herein after the Rules ]and therefore prayed that the matter be restored to the file of the AO for fresh adjudication. Per contra, the ld. AR fully relied on the Ld. CIT(A) s order and claimed that the relief was not allowed by Ld. CIT(A) by admitting any fresh evidence and moreover the issue was adjudicated after calling for the remand report from the AO. 13. We have heard rival submissions and have perused the material available on record. Although in the grounds of appeal as well in the course of hearing, the Revenue has assailed the Ld. CIT(A) s order principally on the ground of vi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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