Tribunal remits issues for peak credit assessment, appellant's appeal allowed

The Tribunal remitted the issues back to the AO for review based on the appellant's claim for assessment on peak credit, allowing the appeal for statistical purposes. The appellant's counsel agreed to be taxed on the basis of peak credit for both the unexplained contract receipt and the gift received from the father, leading to the Tribunal remitting these issues to the AO for reassessment based on peak credit computation. The appellant's appeal was allowed for statistical purposes, with the decision pronounced on 07.08.2014.

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Issues:
1. Addition of entire contract receipt under sec.69A
2. Addition of gift received from father as unexplained cash credit
3. Assessment on peak credit basis

Analysis:
1. The appellant challenged the order of the ld. CIT(A) regarding the addition of the entire contract receipt under sec.69A. The AO required the appellant to explain the sources of deposits in various bank accounts. While the appellant satisfactorily explained a deposit of &8377; 3,00,000, the remaining deposits totaling &8377; 38,54,452 were treated as unexplained income by the AO. The appellant offered to be taxed at 8% of the unexplained deposit amount, but the AO rejected this offer citing lack of proof that the deposits were contract receipts, unclear sources of deposits, unexplained withdrawals, and absence of TDS. The Tribunal remitted this issue back to the AO for review based on the appellant's claim for assessment on peak credit, allowing the appeal for statistical purposes.

2. The second issue involved the addition of a gift of &8377; 3,00,000 received from the appellant's father as unexplained cash credit. The AO issued summons under section 131, but no response was received. Consequently, the AO treated the gift amount as unexplained cash credit. The ld. CIT(A) upheld this action, stating that the appellant failed to substantiate the claim. However, during the appeal, the appellant's counsel agreed to be taxed on the basis of peak credit, leading the Tribunal to remit this issue to the AO for reassessment based on the peak credit computation.

3. The third issue revolved around the appellant's request for assessment on peak credit basis. The appellant's counsel agreed to this method during the appeal, stating that the peak credit amounted to &8377; 11.50 lakh. The Tribunal considered this new claim and remitted the issue to the AO for review and computation of the peak credit for taxation purposes. Consequently, the appeal filed by the appellant was allowed for statistical purposes, and the decision was pronounced on 07.08.2014.

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