Nadukkandi Kunhabdulla Raheena Manzil Vs ITO (ITAT Cochin)
SEO Title: ITAT Remands ₹70.25 Lakh Foreign Remittance Case to CIT(A)
Summary: The Income Tax Appellate Tribunal (ITAT) Cochin has remanded the case of Nadukkandi Kunhabdulla Raheena Manzil v. ITO back to the Commissioner of Income Tax (Appeals) [CIT(A)] for fresh adjudication. The case pertains to the addition of ₹70.25 lakh as unexplained foreign remittances to the assessee’s NRO and NRE accounts for Assessment Year (AY) 2014-15. The AO rejected the assessee’s explanation that the amount represented business sale proceeds, car sale earnings, and remittances from his sons in Bahrain, citing a lack of supporting evidence. The CIT(A) upheld the AO’s decision without providing an independent finding.
The assessee argued that the AO lacked jurisdiction to question the genuineness of credits in an NRE account and that the CIT(A) failed to consider the written submissions. The tribunal observed that while the AO disbelieved the explanation, he did not investigate the source of the remittances, merely dismissing the claim due to insufficient documentation. It also noted that the CIT(A) had not provided any reasoning in its ruling, violating principles of natural justice by failing to engage with the appellant’s submissions.
Referring to judicial precedents, the ITAT emphasized that appellate authorities must give reasoned findings and cannot dismiss appeals in a summary manner. The tribunal cited the principle that an unexplained remittance does not automatically become taxable income unless the revenue department proves its nature as income chargeable to tax. Past cases have established that bona fide foreign remittances should not be disbelieved without substantive evidence.
