TMI Blog2023 (4) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... by valid reasoning is deleted. Unexplained deposits in bank account - HELD THAT:- As the amount was paid through account payee cheque to the assessee and in the said confirmation, the concerned person has clearly stated that the amount paid was towards consideration of the car sold. Thus, when the assessee has furnished evidence to prove the source of the deposit, no addition can be made under section 68 of the Act without conducting any inquiry. Other deposits the assessee has stated that said deposit was out of fees paid by the patients. As it appears on record, the first appellate authority has rejected assessee s explanation without making any inquiry, either himself or through the AO to ascertain the veracity of assessee s claim - delete the addition made in assessment year 2012-13. Assessee appeals are partly allowed. - ITA Nos.732 & 1366/Del/2020 - - - Dated:- 30-11-2022 - Shri Saktijit Dey, Judicial Member For the Appellant : Sh. Shantanu Jain, Advocate For the Respondent : Sh. Om Parkash, Sr. DR ORDER These appeals by the same assessee arise out of two separate orders of learned Commissioner of Income Tax (Appeals)- 20, New Delhi, for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing Officer disallowed a part of the expenses incurred by the assessee. Against the assessment orders so passed, the assessee preferred appeals before learned Commissioner (Appeals). However, learned Commissioner (Appeals), being not convinced with the submissions of the assessee, confirmed the additions made by the Assessing Officer. 4. I have considered elaborate submissions made by learned counsel appearing for the assessee as well as learned Departmental Representative, both, on the legal issue as well as on merits. At the outset, I consider it appropriate to address the issue on merits. Undisputedly, based on the information received from internal sources, the Assessing Officer found that while getting his children admitted to Santosh Medical College, the assessee had paid capitation fee in cash in addition to regular fee. As observed by the Assessing Officer, in course of search and seizure operation and in post search proceeding, Dr. P. Mahalingam, who is the head of the Santosh Group, had admitted that students pay capitation fee in cash. Thus, primarily relying upon certain documents seized in course of search and seizure operation in case of Santosh Group and the sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .39 lakhs for assessment year 2012-13. At this stage, it is relevant to observe, in a case of identical nature wherein identical addition was made based on the incriminating materials found and statement recorded in course of the very same search and seizure operation carried out in case of Santosh Group of Institutions, a division Bench of the Tribunal in case of Sh. Rajendra Singh Vs. ITO, ITA No. 8320/Del/2018, dated 18.06.2020 has held as under: 8. We have considered the rival submissions and perused the material on record. It is not in dispute that the assessee has filed original return of income for the assessment year under appeal on 11.02.2011 (PB-1). Such fact is also mentioned in the assessment order. The reopening of the assessment is made subsequently in 2015. Copy of the reasons for reopening of the assessment are filed at page-13 of the PB in which the A.O. has recorded that as per information received from Investigation Wing search was carried-out on 27.06.2013 in Santosh Medical College Group of Institutions and Dr. P. Maha Lingam, who was Chairman/Director of this Institution, in which, he has admitted to have received regular fees by cash as well as unaccount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r in Medical Course. The same issue have been considered by ITAT, Delhi Bench in the case of Shri Naresh Pamnani, Delhi (supra), which is reproduced as under: IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCHES SMC : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER ITA.Nos.1561/Del./2018 Assessment Year 2010-2011 Shri Rajinder Singh, Vs. The Income Tax Officer, A-56, New Multan Nagar, Ward-42(4), New Delhi -110 056, New Delhi PAN: ACCPS9831R (Appellant) (Respondent) For the Assessee : Shri Gautam Jain, Advocate For Revenue : Shri R.K. Gupta, Sr. DR ORDER PER BHAVNESH SAINI, J.M. This appeal by assessee has been directed against the Order of Ld. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... smissed. 3. The assessee, in the present appeal, challenged the reopening of the assessment as well as the addition on merit. 4. I have heard the Learned Representatives of both the parties and perused the material available on record. 5. Learned Counsel for the Assessee submitted that assessee raised specific ground on merit to challenge the addition on merit, but, the Ld. CIT(A) without any reason noted in the impugned order that assessee has not raised any ground in this regard. He has submitted that Ld. CIT(A) has reproduced all the grounds in the appellate order, in which, in Ground No.6, assessee has challenged the addition of Rs.19,75,000/-. He has submitted that A.O. or the Investigation Wing have not supplied copy of the statement of Dr P Mahalingam to him for rebutting his statement and no cross-examination to his statement have been allowed at any stage, therefore, this statement cannot be read in evidence against the assessee. He has referred to the statement of assessee recorded at assessment stage, copy of which is filed on record, in which he has denied to have paid any amount to Dr P Mahalingam or the above college as capitation fees. He, therefore, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the statement of Dr P Mahalingam on behalf of the assessee, such material cannot be used against the assessee so as to make the impugned addition. I, accordingly, set aside the Orders of the authorities below and delete the addition of Rs.19,75,000/-. 8. Both the parties also argued on initiation of reassessment proceedings and have also cited various case Laws and Ld. D.R. also submitted written submissions. However, in view of the fact that addition on merit have been deleted, the issue of reopening of assessment is left with academic discussion only. I do not propose to decide the same. In view of the above, appeal of assessee is allowed. 9. In the result, appeal of Assessee is allowed. 8.1. Considering the totality of the facts and circumstances of the case noted above in the light of material on record as well as Order of the Tribunal in the case of Shri Naresh Pamnani, Delhi (supra), we are of the view that no addition could be made against the assessee of the impugned amount. In view of the above, we set aside the Orders of the authorities below and delete the entire addition in the hands of the assessee. However, the Revenue is at liberty to pursue their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lakhs and Rs.39 lakhs made under section 68 of the Act are hereby deleted. 11. The next issue which arises is with regard to disallowance of part of the expenses on ad-hoc basis. 12. Having considered rival submissions and perused the materials on record, I find that 50% of the expenditure claimed has been disallowed on purely ad-hoc basis. The disallowance made not being backed by valid reasoning is deleted. 13. The only other issue which arises in assessment year 2012- 13, is addition of an amount of Rs.2 lakhs under section 68 of the Act. Briefly the facts are, in course of assessment proceeding, the Assessing Officer found that the assessee had deposited Rs.1 lakh in his ICICI bank account and Rs. 1 lakh in his PNB bank account. When called upon to explain the source of such deposit, as alleged by the Assessing Officer, the assessee did not file any reply explaining the source of such deposit. Thus, in absence of any explanation from the assessee, the Assessing Officer added back the amount to the income of the assessee. The addition was also confirmed by learned Commissioner (Appeals). 14. I have considered rival submissions and perused the materials on record. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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