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The Tax Recovery Officer and Assessing Officer, Range-7, Pune Versus Shri Nitin V. Sharma and Vica-Versa

2016 (4) TMI 506 - ITAT PUNE

Unexplained cash deposits - CIT(A) deleted the addition on the basis of additional evidence u/Rule 46A of the Rules - Held that:- The perusal of tabulated details filed by the assessee reflected that many of amounts have been received from his father and other amounts which are deposited in cash in Bank of Maharashtra are on account of investment to be made in Shree Om Sainath Car on Rent Pvt. Ltd. Once the assessee has given an explanation that he was receiving these amounts and further made in .....

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stances of the case, where the assessee before us has furnished several documents / evidences, we are of the view that the principles of natural justice demand that an opportunity of hearing should be allowed to the assessee. Accordingly, we set-aside the matter to the file of Assessing Officer to decide the issue de novo after considering the evidences available with the assessee and after allowing reasonable opportunity of hearing to the assessee. - Decided in favour of assessee and the Revenu .....

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2. The cross appeals filed by the Revenue and the assessee were heard together and are being disposed of by this consolidated order for the sake of convenience. 3. The Revenue in ITA No. 1818/PN/2013 has raised the following grounds of appeal:- 1. On the facts and in the circumstances of the case, the learned CIT(A) has erred in deleting the addition of ₹ 19,50,000/- made by the AO on account of unexplained cash deposits of the assessee in Bank of Maharashtra. 2. On the facts and in the ci .....

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Appeals) be set aside that of the A.O. be restored. 4. The assessee in ITA No. 1827/PN/2013 has raised the following concise grounds of appeal:- 1. The learned CIT(A) was not justified in sustaining the addition of ₹ 40,76,600/- without appreciating that the addition made u/s 68 based on bank statements was bad in law liable to be deleted. 2. The learned CIT(A) grossly erred in sustaining addition based entirely on presumptions and surmises. 3. The learned CIT(A) was unjustified in not app .....

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y the Revenue and the assessee are in relation to addition made on account of cash credit under section 68 of the Act made by the Assessing Officer and partly confirmed by the CIT(A). 6. Both the Revenue and the assessee are in appeal against the order of CIT(A) and we proceed to decide both appeals after hearing the learned Authorized Representatives. 7. Briefly, in the facts of the present case, during the course of assessment proceedings the Assessing Officer noted that the assessee was a sal .....

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from foreign currency transactions as well as income by way of commission in respect of investments brought by him in Aurum Realty Ltd. and Shree Om Sainath Car on Rent Pvt. Ltd. The assessee also explained that certain amount was received by him on conversion of US dollars and the said amount was deposited in Bank of Maharashtra. Further, in respect of cash deposits in ABN Amro Bank, it was claimed that he had received the amount from his father Mr. Ved Prakash Sharma on 28.05.2008 of ₹ 2 .....

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Assessing Officer, the assessee furnished the identity of the parties by filing confirmation and by giving PAN numbers. Since the assessee had failed to produce the copy of bank accounts or copy of return of the individual persons, the Assessing Officer was of the view that the genuineness of the creditors and their capacity to advance the said amount was not proved. The Assessing Officer was of the opinion that the explanation filed by the assessee as source of deposit of cash was only make bel .....

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₹ 31,01,100/- was also treated as unexplained income under section 68 of the Act. 8. Before the CIT(A), the assessee furnished similar explanation along with some documentary evidence, were filed and the said documents furnished by the assessee in the Paper Book were forwarded to the Assessing Officer for comments with regard to admission of additional evidence under Rule 46A of the Income Tax Rules, 1962 (in short the Rules ) . The Assessing Officer in reply, opposed the admission of doc .....

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s of cash deposit in the saving account with Bank of Maharashtra also, further evidences were filed by the assessee before the CIT(A) which were accepted partly and deposit of ₹ 19,64,500/- i.e. ₹ 19,50,000/- + ₹ 14,500/- was accepted and the balance was upheld. Thus, out of total addition of ₹ 60,41,100/- made by the Assessing Officer on account of unexplained cash deposit, the addition to the extent of ₹ 40,76,600/- was sustained and the addition of ₹ 19,64, .....

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f being heard and thus, violated the principles of natural justice. Further, the assessee before us has filed an application for admission of additional evidence with regard to the amounts received in cash from his father to the extent of ₹ 12,75,000/- as gift and further ₹ 7,25,000/- received from Ms. Sangita Sharma to be invested with Aurum Realty Ltd. The claim of the assessee before us is that the confirmation letters from both these persons were submitted. However, the Assessing .....

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ts are available with the assessee, which has not been considered by the Assessing Officer. It was pointed out that during the assessment proceedings total queries were in respect of deposits in ABN Amro Bank and in respect of Bank of Maharashtra, the first query was raised on 27.12.2011. He further drew our attention to the fact that his father was working with Air Force and land was acquired by the Collector and the amount was received by him, which was thereafter given to the assessee. In res .....

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he absence of sufficient opportunity being not allowed by the Assessing Officer, the aforesaid addition was made in the hands of assessee. 10. The Revenue is in appeal against the deletion of addition to the tune of ₹ 19,50,000/- on the surmise that the additional evidence has been considered by the CIT(A) without conforming to the provisions of Rule 46A of the Rules. 11. We have heard the rival contentions and perused the record and also the evidences filed by the assessee in the Paper Bo .....

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