Vikrant Sandal Vs ITO (ITAT Chandigarh)
The Chandigarh Bench of the Income Tax Appellate Tribunal (ITAT) partly allowed the appeal filed by the assessee for Assessment Year 2010-11 against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, arising from an assessment framed under Sections 143(3) read with 147 of the Income-tax Act, 1961.
The assessee’s case was reopened through a notice issued under Section 148 on 26 March 2017 to examine investments in purchase of property, cash deposits, and cash payments towards credit card dues. Since the assessee had not filed an income tax return, the Assessing Officer (AO) formed an opinion that income amounting to ₹101.91 lakh had escaped assessment. Consequently, scrutiny proceedings were undertaken.
During the assessment proceedings, it emerged that the assessee had purchased agricultural land situated at Village Randhawa, Tehsil Dasuya. The assessee submitted bank statements and the purchase deed to establish that the investment had been financed by his mother. According to the records, ₹5 lakh had been paid through cheque and ₹68.86 lakh through RTGS from the bank account of the assessee’s mother. The expenses relating to stamp duty and registration were stated to have been met from cash withdrawals made from the same account. However, as the assessee failed to produce his mother for verification, the AO treated the investment of ₹73.86 lakh as unexplained. The AO also made additions of ₹23.36 lakh towards cash deposits and ₹3.99 lakh towards credit card payments made in cash.
