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| The Tax Publishers2020 TaxPub(DT) 2866 (Del-Trib) INCOME TAX ACT, 1961
Section 251
Where any notice of enhancement was issued to assessee and prior to such notice it was not known whether CIT(A) had asked assessee to explain the source of investment and assessee was required to explain the source of investment but evidences filed by assessee have been simply rubbished by CIT(A), therefore, CIT(A) was directed to examine the evidences relating to the source of investment and should proceed further keeping in mind that AO had not made any addition under section 69.
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Appeal CIT(A) - Powers conferred to CIT(A) under section 251 - Unexplained investment under section 69 - Explanation to source of investment
Assessee had sold immovable property alongwith one other co-owner for a sum out of which, half share belonged to assessee and notice under section 148 was issued and served upon the assessee. None attended on behalf of assessee and AO was forced to proceed ex-parte. AO was of the firm belief that consideration was a short term capital gain and, accordingly, added the same to the income of assessee. CIT(A) called for remand report and AO accepted that short term capital gain and assessee's share. However, CIT(A) was of the opinion that source of investment remained unexplained under section 69. Assessee filed necessary details of his source of investment which did not find any favour with CIT(A) who proceeded by confirming the addition made by AO and made further addition. Assessee vehemently stated that CIT(A) had made addition under a new source of income which was never considered by AO and thereby exceeded his powers. Held: A perusal of the order of the first appellate authority does not reveal that any notice of enhancement was issued to assessee and prior to such notice it was not known whether CIT(A) had asked assessee to explain the source of investment. Though there was a passing reference that assessee was required to explain the source of investment but evidences filed by assessee have been simply rubbished by CIT(A). CIT(A) ought to have asked the assessee to explain the source of investment and if not satisfied, then should have issued notice of enhancement. Therefore, CIT(A) was directed to examine the evidences relating to the source of investment and after satisfying himself, should proceed further keeping in mind that AO had not made any addition under section 69.
Relied:CIT v. B.P. Sherafudin (2017) 399 ITR 524 (Ker) : 2017 TaxPub(DT) 4686 (Ker-HC) CIT v. Sardari Lal & Co (2001) 251 ITR 864 (Del) : 2001 TaxPub(DT) 1617 (Del-HC)
REFERRED :
FAVOUR : Matter remanded
A.Y. : 2009-10
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