Sarang Avinash Kamtekar Vs ITO (ITAT Pune)
CIT(A) Should Have Awaited AO’s Remand Report After Admitting Additional Evidence: Pune ITAT Restores Property Investment Addition
The assessee purchased immovable property for approximately ₹2 crore and received technical fees of ₹8,18,300 during AY 2018-19, but did not originally file a return of income. In response to reassessment proceedings, he filed a return declaring income of ₹4,75,220.
The assessee explained that the property was purchased from accumulated savings and secured and unsecured loans obtained from friends and relatives. However, due to inadequate compliance and supporting evidence, the AO made the following additions:
- ₹2,12,30,100 as unexplained investment under section 69; and
- ₹4,09,150 as professional income estimated under section 44ADA.
The total income was assessed at ₹2,21,14,470.
During the appellate proceedings, the CIT(A) admitted additional evidence and granted partial relief. However, it rejected unsecured loans of ₹51,55,000 and accumulated savings of ₹10,75,100 claimed as sources for the property purchase.
Before the ITAT, the assessee produced confirmations and income-tax particulars of the lenders. It was further pointed out that, after admitting the additional evidence and calling for a remand report, the CIT(A) passed the order without waiting for the AO’s comments or remand report.
The Tribunal held that the assessee deserved another opportunity to establish the sources of the property investment. Accordingly, the additions sustained by the CIT(A) were set aside and the disputed issues were restored to the AO for fresh adjudication after considering the evidence and granting an adequate opportunity of hearing.
FULL TEXT OF THE ORDER OF ITAT PUNE
The assessee has filed the appeal against the order of the CIT(A)/NFAC Delhi passed u/sec 250 of the Income Tax Act. The assessee has raised the grounds of appeal challenging the order of the CIT (A) partly sustaining the addition made by the Assessing Officer.
