This analysis covers the appeal by Rura Ram Birok against the order of the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, for the assessment year 2012-13, which is focused on unexplained cash deposits in a bank account.
The case stems from a search operation and subsequent cash deposits of INR 2,187,000 identified in the assessee’s bank account, which led to the reopening of the assessment under section 147 of the Income Tax Act, 1961.
The main issue revolves around the non-consideration of the sale proceeds of a house totaling Rs 29,00,000, which was partly received in cash and through cheque. The assessment was reopened based on cash deposits observed in the assessee’s bank account.
The Assessing Officer (AO) and the CIT(A) both upheld the addition due to the non-availability of a conventional sale deed, despite the transaction being executed through a registered General Power of Attorney (GPA). Furthermore, issues were raised regarding the non-consideration of fund flow and related bank transactions.
The Income Tax Appellate Tribunal decided to set aside the order of the CIT(A) and remanded the case back to the AO for a thorough examination of the transaction details and to verify the claim related to the proceeds from the sale of immovable property managed by the assessee’s wife.
This case highlights the complexities involved in dealing with real estate transactions recorded through GPA instead of traditional sale deeds and the implications for tax assessments involving substantial cash transactions.
Rura Ram Birok vs ITO, Ward-4, Hisar: Legal Analysis for Assessment Year 2012-13
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