Case Law Details
ITO Vs Jakshibhai Dahyabhai Bharvad (ITAT Ahmedabad)
Introduction: In the case of ITO vs Jakshibhai Dahyabhai Bharvad, the Income Tax Appellate Tribunal (ITAT) Ahmedabad upheld the Commissioner of Income-Tax (Appeals), Gandhinagar’s order concerning the deletion of income tax addition due to unexplained investment in properties. The case was for the Assessment Year 2012-13, and it revolved around the issue of unexplained source of investment and short-term capital gains. This article aims to dissect the key aspects of the judgment and its implications.
The Background: The Revenue filed an appeal against the CIT(A) order, which allowed some relief to the assessee on account of unexplained investment and short-term capital gain. The assessment was framed under section 147 of the Income Tax Act, 1961, and the CIT(A) had provided relief on two counts, totaling around Rs. 1.66 Crores.
Issues Raised by the Revenue: The primary issues raised by the Revenue pertained to the deletion of the addition of Rs.49,25,127/- made on account of unexplained investment for the purchase of immovable property, and Rs.1,17,27,587/- made on account of Short Term Capital Gain.
CIT(A)’s Observations and Actions: The CIT(A) scrutinized the available evidence and noted that some of the additions made by the Assessing Officer (AO) lacked proper documentation and basis. Therefore, he adjusted the amount based on evidences presented, thereby reducing the assessee’s tax liability.
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