ACIT Vs Rajan Sehgal (ITAT Delhi)
Conclusion: Additions made by AO on investment in mutual fund during the current assessment year was deleted as AO merely relied on the information’s gathered from individual transaction statements and AO failed to cross verify the same with relevant bank statements submitted by assessee.
Held: Assessee was a non-resident and maintaining non-residential status for more than 15 years. He was a regular filer of return of income declaring income sourced from India. AO had made the addition with the observation that no response was received from assessee. Based on that, he proceeded to complete the assessment u/s 144 based on the information available on his record. There was no proper opportunity was extended to assessee during the current assessment proceedings because of that assessee had submitted various information after draft assessment order. However, AO had not considered those information. Even before CIT (A), assessee had submitted additional informations under Rule 46A. CIT (A) as per information available on record remanded the matter back to AO. However, AO did not accept or verify the additional evidences forwarded by CIT(A). CIT(A) had brought on record and made his observations. CIT(A) also reproduced various submissions made by both the parties and proceeded to adjudicate the issue as per the information available on record. As per the findings of CIT (A), it was found that the investments made in mutual funds were made from bank account maintained with HSBC. CIT (A) also tabled the details of the investments made by assessee during the year to the extent of Rs.2,78,10,878/-. He also found that sources for the investment in the mutual funds were from resale of existing mutual funds and other funds remitted through Citi Bank of UAE from the salary income earned by the assessee in UAE. All the above findings of CIT (A) were evident from the bank statements with HSBC and Citi Bank submitted by assessee. Further he observed that AO merely relied on the information’s gathered from individual transaction statements and AO failed to cross verify the same with relevant bank statements. Based on the above findings, CIT(A) deleted the additions made by AO on investment in mutual fund during the current assessment year. After considering the submissions and the findings given by CIT (A) were based on the information very much available on record and it was also fact on record that assessee was an NRI and all the source of income were from his salary income earned by assessee outside India. Therefore, the findings of CIT (A) was valid considering the fact that all the information were traced from the bank statements submitted by assessee. Therefore, there was no reason to disturb the findings of CIT (A).
