AI Drafter 
TaxTMI 
TaxTMI 
2018 (5) TMI 1012
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.... 22.03.2012 disclosing total income of Rs. 65,79,920/-. Later the case was selected for scrutiny. During the course of assessment, the AO noted from the Balance Sheet that the assessee had FD at Bank of India which is shown at Rs. 3,31,83,887/-, which according to AO, did not tally with the figures available in ITS details of the assessee downloaded by him. According to AO, the said ITS details were handed over to the assessee through her AR for verification and reconciliation. Since no explanation came from the assessee's side and the FD details obtained from the bank authority showed the same as Rs. 3,76,65,625/- instead of Rs. 3,31,83,887/- as stated by the assessee, the differential amount of Rs. 44,81,738/- was added as undisclosed investment representing her undisclosed income and was added to the total income. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A), who was pleased to delete the same. Aggrieved, the revenue is before us. 4. We have heard rival submissions and gone through the facts and circumstances of the case. We note that when the AO pointed out to the assessee that there was a difference in the Balance Sheet in respect of the FD at Bank of I....
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....th Bank of India. We note that the assessee had produced the letters of fixed deposit with Bank of India for AYs 2010-11 and 2011-12 which we note has been placed at page 46 and pages 6 to 10 of the paper book. It was explained before us with the help of the ledger of fixed deposit with Bank of India for AY 2011-12, that the maturity proceeds of the FD (as on 31.03.2010) was received by the assessee in her savings bank account with Bank of India and thereafter was transferred to her FD account with Bank of India. It was also brought to our notice that interest accrued on the existing FD savings bank was transferred to the FD as investment, thus increasing the value of investment in FD by an amount of Rs. 3,76,65,625.26/- as evident from perusal of page 10 of the paper book. Thus, we note that the Ld. CIT (A) has rightly noted that the increase of her investment in FD with Bank of India was not her undisclosed income as alleged by the AO and we do not find any infirmity in this finding of Ld. CIT(A) and we concur with the same. 6. Coming to the ground raised by the revenue in respect of violation of Rule 46A, we note from the impugned order of the Ld. CIT (A) that the Ld. CIT (A)....
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....ount were filed by the assessee before the AO which is enclosed at pages 1 to 5 of the paper book. We note that the Ld. CIT (A) after taking note of these facts have decided as under: "I have gone through the circular and order of the court as well as other material on record. Since this is a question of strictly legal taxability of a particular item, it is settled law that this can be raised at the appeal stage for the first time. As per the material on record produced before me, I find that the appellant indeed had not excluded the principal amount of investment at the time of offering the redeemed UTI mutual funds for taxation. It is obvious that the principal amount has to be excluded as this does not form part of income. This ground is therefore allowed with directions to the A/O to go through the details of mutual fund investment and tax only the amount which is taxable after excluding the principal sum of investment which was wrongly shown as income. As a result this ground is allowed." Aggrieved, revenue is before us. 9. We note that the Ld. CIT(A) has decided the issue raised by the assessee and has directed the AO to go through the details of the m....
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....der sub-section (1) the Assessing Officer shall by an order in writing, make an assessment of the total income or loss of the assessee, and determine the sum payable by him or refundable to him on the basis of such assessment; b. in a case where an assessment has been made under sub-section (1), if either such assessment has been objected to by the assessee by an application under clause (a) of subsection (2) or the Assessing Officer is of opinion that such assessment is incorrect, inadequate or incomplete in any material respect, the Assessing Officer shall, by an order in writing make a fresh assessment of the total income or loss of the assessee, and determine the sum payable by him or refundable to him on the basis of such assessment." 12. On perusal of the above, we note that the A.O. was authorized by the Legislature to make assessment of the total income or loss and determine the sum which was 'payable' or 'refundable' on the basis of the assessment. Meaning thereby, the A.O. was legally empowered in law to make assessment of the total income of the assessee at a lower sum than the returned income, which would result in 'sum refundable' to the assessee. 13. Th....