TaxTMI 
TaxTMI 
TaxTMI 
2025 (12) TMI 1422
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....d, alter, amend, rectify, delete, withdraw and/or otherwise modify all or any of the grounds and/or to adduce evidence on or before the final hearing." 2. At the time of hearing, none appeared for the assessee. However, an adjournment petition has been filed by the assessee which is rejected. The matter is heard after recording the submissions of the Ld. Sr. DR and on a careful perusal of the documents available on record. 3. In this case, the assessee company is engaged in the business of running nursing school and college and filed return of income for A.Y.2014-15 on 06.01.2015 declaring total income of Rs. 12,83,980/-. Subsequently, the case of the assessee was selected for scrutiny assessment and the A.O completed the assessment u/s. 143(3) of the Income Tax Act, 1961 (for short 'the Act') dated 25.12.2016 determining total income at Rs. 23,33,980/-. The relevant facts are that the assessee company had received share application money from Directors of the company. The Directors of the company had paid share application money to the company and in this regard, one of the Director, Shri Ramesh Gandhi had deposited an amount of Rs. 3,50,000/- in his bank account and similar....
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....rtment. Since the entire addition emanates from the non-explaining the nature and source of the cash deposits made by the Directors before transferring the same to the assessee's A/c. for purchasing shares, it is therefore, question of unexplained money and the addition, if at all has to be made that would be done u/s. 69A of the Act and not u/s. 68 of the Act. This is a clear case of non-application of mind by the quasi-judicial authority. The quasi-judicial authority are authorized to dispense justice both substantive and equitable. Substantive justice refers to the person on whom tax liability are to be imposed, whereas, equitable justice refers to the proper application of mind considering the facts and circumstances of the case. In this regard, I refer to the following judicial pronouncements where for non-application of mind, the addition have been deleted from the hands of the assessee. 6. The Co-ordinate Bench of Delhi in the case of Sanjeev Kumar, C/o M/s. Raj Kumar & Associates vs. ITO Ward 2(3)(2), Bulandshahr, reported in 2023(10) TMI 1027-ITAT Delhi on the same issue of "nonapplication of mind" had observed and held as follows: "14. In view of foregoing dis....
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....rent that the subject matter of the dispute all through before the Tribunal in appeal was only with regard to the addition of alleged amount of the gift received by the appellant-assessee as his personal income under Section 68 of the Act and not whether such an addition can be made under Section 69-A of the Act. In view of the above, it can safely be said that the Tribunal travelled beyond the scope of the appeal in making the addition of the said income under Section 69-A of the Act. It may be worth noting that the Tribunal has recorded a categorical finding that "it is clear that under the provisions of Section 68, the addition made by the Assessing Officer and sustained by the CIT (Appeals) cannot be sustained, meaning thereby that the Tribunal was of the opinion that the Assessing Officer and the CIT (Appeals) committed an error in adding the aforesaid amount in the income of the appellant-assessee under Section 68 of the Act. In view of the above, when the said income cannot be added under Section 68 of the Act and the Tribunal was not competent to make the said addition under Section 69-A of the Act, the entire order of the Tribunal stand vitiated in law. ....
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....plains the source of cash deposit to the bank account of assessee, wherein the assessee has not only included cash receipts as salary and capital withdrawal from two partnership firms M/s Umang Beverages and M/s Mohan Oil & Cattle Feed and a cash salary from Bihar Milk Foods Pvt. Ltd. and has also reduced the amount of drawings for household expenses. The copy of return of income of wife of assessee Smt. Shalini and father of assessee Shri Kalu Mal co-jointly established that the other family members of assessee are also earning and contributing towards household expenses. Therefore, in my humble understanding the source of cash deposit during demonetization to the bank account of assesses is properly explained by the assessee by way of self speaking documentary evidence and explanation. Secondly, the AO has made addition u/s 69 of the Act which pertains to unexplained investments, whereas the assessee has not made any investment either in movable or any immovable property during the relevant period by way of using cash amount. The Ld.CIT(A) though has given credit of 25% of Impugned cash deposit confirming the remaining part of addition but there is no logic of this segregation. F....