Case Number: ITA 1465/DEL/2020
Appellant: Rajesh Kumar, Narnaul
Respondent: ITO Ward-2, Narnaul
Assessment Year: 2013-14
Result: 2013-14
Case Filed On: 2020-08-05
Order Type: Final Tribunal Order
Date of Order: 2022-08-03
Pronounced On: 2022-08-03
Rajesh Kumar, residing in Narnaul, filed an appeal against the order of the CIT(A), Rohtak dated 13.02.2020, contesting the assessment and penalty imposed by the Income Tax Officer (ITO) Ward-2, Narnaul for the assessment year 2013-14. The primary issue was related to the jurisdiction and validity of the assessment proceedings initiated under Section 147 of the Income Tax Act, 1961.
The case was heard by the Delhi Bench ‘F’ of the Income Tax Appellate Tribunal (ITAT), New Delhi, comprising Sh. Saktijit Dey, Judicial Member, and Dr. B. R. R. Kumar, Accountant Member.
ITA No. 1465/Del/2020: This appeal by Rajesh Kumar was against the order of the CIT(A), Rohtak dated 13.02.2020, pertaining to A.Y. 2013-14 regarding the assessment and penalty proceedings initiated under Section 147/143(3) of the Act.
The appellant raised several grounds challenging the initiation and completion of assessment proceedings under Section 147/143(3) of the Act, arguing that the proceedings were without jurisdiction and the reasons recorded for reopening the assessment were not valid. The appellant contended that there was no specific, relevant, reliable, and tangible material to form a ‘reason to believe’ that income had escaped assessment.
The reasons recorded by the Assessing Officer (AO) for initiating proceedings under Section 147 were based on information about substantial cash deposits made by the appellant in his HDFC bank account during the financial year 2012-13. The AO issued multiple query notices to the appellant, but no satisfactory response was received.
During the assessment proceedings, the appellant was asked to explain the source of capital introduced during the year and was show-caused as to why the amount should not be added to his income. The appellant claimed that the capital was introduced from a gift received from his father, but failed to provide supporting documents, leading the AO to add the amount to the appellant’s income under Section 68 of the Act.
The Tribunal examined the records and found no relation between the reasons recorded for reopening the assessment and the actual additions made. It was observed that the AO did not inquire about the cash deposits during the assessment and no addition was made on account of the amounts received.
The Tribunal referred to established jurisprudence, including the case of CIT vs. Jet Airways (I) Ltd. (331 ITR 236), which held that if the AO does not assess or reassess the income for which reasons were recorded, it is not open to the AO to assess other incomes that come to notice subsequently during the reassessment proceedings.
Following this jurisprudence, the Tribunal held that the AO had a deficiency of jurisdiction in assessing any other income unrelated to the reasons recorded and therefore, the additions made were invalid.
The Tribunal allowed the appeal of Rajesh Kumar, quashing the assessment order and directing the AO to delete the impugned additions.
Order pronounced in the open court on 03/08/2022.
SD/- SD/-
(Saktijit Dey) (Dr. B. R. R. Kumar)
Judicial Member Accountant Member
Date: 03/08/2022
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(A)
5. DR
Assistant Registrar, ITAT, New Delhi
ITA 1465/DEL/2020: Rajesh Kumar vs ITO Ward-2, Narnaul – Case Filed Due to Dispute on Cash Deposits
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