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of <h1>Successful appeal against assessment order; Tribunal directs deletion of additions, stresses proper inquiry and substantiation.</h1> <h3>Jag Bhushan Tanwar Versus Income Tax Officer, Ward-1 (3), Faridabad.</h3> Jag Bhushan Tanwar Versus Income Tax Officer, Ward-1 (3), Faridabad. - TMI Issues Involved:1. Assessment order challenged as void-ab-initio2. Dispute over cash deposits and withdrawals3. Legitimacy of gifts received by spouse4. Income from a small diary business5. Permission to modify grounds of appealAnalysis:1. Assessment Order Challenge:The appeal challenged the order of the Commissioner of Income-tax (Appeals), contending that the assessment order under section 143(3)/147 was erroneous and should be quashed. The appellant argued that the order was bad in law and void-ab-initio. The Tribunal noted the grounds raised by the assessee and proceeded to analyze each issue in detail.2. Dispute over Cash Deposits and Withdrawals:The assessment was reopened under section 147 of the Income-tax Act, 1961, based on cash deposits in the bank account. The appellant claimed the deposits were from past savings, sale of jewelry, and cash withdrawals. However, the Assessing Officer made an addition of Rs. 12,55,000. The Commissioner of Income-tax (Appeals) partially allowed the appeal, deleting Rs. 9,63,000 of the addition. The Tribunal reviewed the facts and evidence, ultimately directing the Assessing Officer to delete the remaining addition due to lack of inquiry and justification for the addition.3. Legitimacy of Gifts Received by Spouse:The appellant asserted that gifts received by the spouse from her brother were genuine, supported by an affidavit. The Commissioner of Income-tax (Appeals) accepted some gifts as a source of cash deposits but rejected others due to lack of evidence. The Tribunal upheld the acceptance of certain gifts but directed the deletion of the addition related to unverified gifts, emphasizing the need for proper inquiry and substantiation.4. Income from Small Diary Business:Regarding income from a small diary run by the spouse, the appellant argued that deposits from the business were genuine and exempt from tax due to the small savings. The Tribunal found that the authorities did not conduct a thorough inquiry into the source of income and household expenses. Consequently, the Tribunal directed the Assessing Officer to delete the addition, considering the independent income sources of the spouse and father.5. Permission to Modify Grounds of Appeal:The appellant sought permission to alter the grounds of appeal during the hearing. While the Tribunal did not delve into this issue explicitly in the judgment, the order pronounced on 11th January, 2023, indicated that the appeal of the assessee was allowed, implying that the Tribunal may have considered the grounds raised during the proceedings.In conclusion, the Tribunal's decision addressed various issues raised by the appellant, focusing on the legitimacy of cash deposits, gifts, and income sources. The judgment emphasized the importance of proper inquiry, substantiation of claims, and the need for authorities to verify income sources before making additions to the assessment.
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