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2025 (1) TMI 506

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....w. Consequent assessment framed thereupon is liable to be cancelled. 2) The learned CIT(A) erred in holding that there is sufficient grounds for reopening and same is done following due process of law and consequently dismissing the grounds of appeal challenging validity of notice u/s 148 of I.T. Act 1961. 3) The learned CIT(A) erred in confirming the addition of Rs. 13 lacs out of addition made by A.O, at Rs. 15.50 lacs on account of unexplained investment. 4) The learned CIT(A) ought to have held that investment with Wasanker Group stands fully explained considering the cash flow statement and bank statement submitted by assessee. 5) Addition sustained at Rs. 13 lacs is unjustified and unsustainable on the principles of absence of....

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....n reproduced at Page-1 & 2 of the assessment order. The amount given was explained by submitting details of bank account to show that the amount has been withdrawn from bank in previous years as well as in the current year. The Assessing Officer, however, did not accept the explanation of the assessee stating that such explanation is not tenable in the eyes of the law. Thus, the Assessing Officer made addition of Rs. 15.50 lakh as unexplained investment within the mean of section 69 r/s section 115BBE of the Act. 4. On appeal, the learned CIT(A) partly allowed the assessee's appeal by sustaining addition of Rs. 13 lakh on account of unexplained investment. The relevant decision of the learned CIT(A) at Para-8 of his order is reproduced bel....

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....up Company at Rs. 15,50,000/-. 8 & 9 .......... 10. ......... However, in the given facts and circumstances of the case, keeping in view of past savings, it would be justified if relief of Rs. 2,50,000 is made and addition of unexplained investments is confirmed and restricted to Rs. 13,00,000, to be taxed w.r.t. section 115BBE." 5. Before us, the learned Counsel, Shri Kishore Dewani, appearing for the assessee submitted that it is settled proposition of law that provisions of section 69 of the Act are not mandatory. Explanation adduced in the case of the assessee is reasonable. The assessee has no source of activity other than salary income from which the assessee could be said to have derived any undisclosed income. The Assessing Off....

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.... in Page-7 to 12 of its order, has not been disputed as to the facts and evidence on record. We also find that no reason is indicated in the assessment order and/or in the impugned first appellate order as to why the explanation of the assessee is not being accepted. Mere investment with M/s Wasankar Group by itself is no reason to derive belief for escapement of income as has been concluded in the reasons recorded for issue of notice u/s 148 of I.T. Act 1961. The addition made in the assessment framed at Rs. 15.50 lakh and sustained by the learned CIT(A) at Rs. 13 lakh is unjustified and unsustainable considering the fact and evidence on record. The details of withdrawals and bank account for the past four years are placed on record at Pag....