2024 (9) TMI 452 - AT - Income Tax

Assessee gets second chance as ITAT remands unexplained property investment case back to AO for fresh assessment

The ITAT Jaipur allowed the assessee's appeal for statistical purposes and remanded the matter to the AO. The case involved an ex-parte assessment with ... Assessment as done ex-parte - Addition unexplained investment in property/land - CIT(A) has dismissed the appeal of the assessee, considering the submission of the assessee as afterthought and hence, the appeal of the assessee was dismissed - HELD THAT:- Assessee assured before the Bench if one chance be given to the assessee he will submit all the details related to the investment made and thereby to assessee income before the AO. As it is evident from the record that the order in this case is ex-parte before the AO and therefore, considering that aspect of the matter we hold to remand back the matter to the file of the AO who will decide the issue based on evidence and submission of the assessee as submitted in the remind proceeding. The assessee will not seek any adjournment on frivolous ground and remain cooperative during proceedings before the AO. Appeal filed by the assessee is allowed for statistical purposes. Issues:Appeal against assessment order under Income Tax Act, 1961 for unexplained investment in property/land.Analysis:The appeal was filed by the assessee against the order of the Ld. National Faceless Appeal Centre, Delhi, for the assessment year 2012-13, arising from the order passed under section 144 r.w.s 147 of the Income Tax Act, 1961 by the ITO, Ward-1, Kishangarh. The primary contention of the assessee was the addition of Rs. 1,09,36,920.00 under section 69 of the Act for unexplained investment in property/land. The assessee's return of income declared Rs. 2,04,030/-, but the revenue found discrepancies related to the purchase of immovable property. The AO issued a notice under section 148, but the assessee failed to file an ITR, leading to an ex-parte assessment under section 144. The AO considered the cash payment made by the assessee for the property and added it as unexplained investment. The CIT(A) upheld the AO's decision, stating that the appellant failed to provide sufficient evidence regarding the source of cash transactions, including gifts from family members. The appeal was dismissed by the CIT(A), prompting the assessee to approach the Tribunal.The Tribunal noted that the assessment was ex-parte, and the CIT(A) dismissed the appeal based on the perceived lack of credible explanations from the assessee. The assessee requested an opportunity to submit relevant details to the AO if given a chance. The DR supported the CIT(A)'s decision, emphasizing the lack of details regarding the source of funds for the property purchase. The Tribunal decided to remand the matter back to the AO for a fresh assessment, considering the ex-parte nature of the previous assessment. The assessee was directed to cooperate with the AO and provide necessary evidence during the proceedings. The decision to remand the matter did not reflect on the merits of the dispute, which would be independently adjudicated by the AO in accordance with the law. Consequently, the appeal was allowed for statistical purposes.In conclusion, the Tribunal's decision to remand the matter back to the AO provides the assessee with an opportunity to present relevant details and evidence regarding the unexplained investment in property/land, ensuring a fair assessment based on the submissions made during the proceedings.