Matter restored as ex-parte addition made towards unexplained investment

Virender Singh Vs ITO (ITAT Delhi)

ITAT Delhi held that as lower authority made ex-parte addition towards unexplained investment u/s 69 of the Income Tax Act matter restored to CIT(A) for denovo adjudication giving last opportunity to assessee to explain source of investment.

Facts- There was a Tax Evasion Petition (TEP) received by CCIT, Delhi against Assessee, Virender Singh along with a copy of registered purchase deed regarding purchase of 4 bighas and 16 biswal of agricultural land at Delhi. The petition also alleged that all the payments were made in cash. This document was registered in the name of the assessee. Since the assessee did not have PAN and had not submitted his income tax returns, the case of the assessee was reopened vide issuance of notice u/s 148 of the Act. This notice was duly served upon the assessee.

Inspite of many attempts there was no response from the side of the assessee and hence the ld. AO was forced to complete the assessment exparte by making an addition of Rs 56,18,000/- as unexplained investment made in purchase of immovable property u/s 69 of the Act. CIT(A) also proceeded to decide the issue based on material available and uphold the addition. Being aggrieved, the present appeal is filed.

Conclusion- Held that one last opportunity is to be given to the assessee to explain the sources for making investment in immovable property. Accordingly, the appeal of the assessee is restored to the file of ld. CIT(A) for denovo adjudication in accordance with law. The ground raised by the assessee is allowed for statistical purposes.

Please become a Premium member. If you are already a Premium member, login here to access the full content.