Vishal Rajnikant Shah Vs ITO (ITAT Nagpur)
Nagpur ITAT: ₹71.76 Lakh Addition u/s 69A Cannot Rest Merely on Departmental Information When Assessee Disputes Ownership of Bank Account – Remanded
The Nagpur ITAT dealt with an addition of ₹71.76 lakh u/s 69A, representing deposits/credits appearing in an account allegedly maintained by the assessee with Shri Renuka Mata Multi State Urban Cooperative Credit Society Ltd. The assessee, whose disclosed income was from salary and interest, consistently denied maintaining or owning the said account. The AO nevertheless treated the entire deposits as unexplained money and the CIT(A) confirmed the addition.
Before the Tribunal, the assessee contended that the AO had not conducted any independent enquiry to establish that the disputed account actually belonged to him. He also offered to produce additional documents and evidence to establish the true facts concerning the deposits.
Significantly, the assessee also raised additional legal grounds challenging the reassessment on two jurisdictional issues: (i) notice u/s 148 having been issued by the jurisdictional AO instead of the Faceless AO, relying upon the Bombay High Court decision in Hexaware Technologies Ltd., and (ii) whether proceedings ought to have been initiated u/s 153C rather than u/s 147 since the information emanated from a search conducted in the case of the cooperative society/bank. The Tribunal admitted these additional grounds as pure questions of law following NTPC Ltd. v. CIT.
The ITAT, however, did not finally adjudicate either the jurisdictional grounds or the merits of the ₹71.76 lakh addition. Considering that ownership of the account itself was disputed and additional evidence remained to be examined, it set aside the orders below and restored the entire matter to the AO for de novo assessment. The AO was directed to examine the documentary evidence, conduct necessary enquiries and pass a speaking order in accordance with law.
Thus, the appeal was allowed for statistical purposes, essentially giving the assessee a fresh opportunity to establish that the impugned account/deposits did not belong to him.
Cases Discussed:
- NTPC Ltd. vs. CIT (Supreme Court), [(1998) 229 ITR 383 (SC)]
- Hexaware Technology Ltd. (Bombay High Court), Writ Petition No. 1778/ of 2023
FULL TEXT OF THE ORDER OF ITAT NAGPUR
