Case Law Details
Meetu Bansal Vs DCIT (Uttarakhand High Court)
Uttarakhand High Court held that issuance of notice by Commissioner (Appeals) mandatory in terms of section 251(2) of the Income Tax Act before enhancing the assessment.
Facts- The Income Tax Department carried out search and seizure operation on 26.04.2012, in respect of the appellant’s husband, including the residential premises of the appellant. Notice was issued to the appellant u/s. 153A of the Income Tax Act. In response to the said notice, she submitted her return.
Notices were issued to the appellant/assessee u/s. 153A read with Section 143(3) and Section 142(1) of the Income Tax Act. The appellant filed the return u/s. 156A, along with an income statement / balance sheet, on 31.03.2007. AO, while accepting the declared income of the appellant, made addition to the tune of Rs.5,63,500/- by adding: (a) a sum of Rs. 1.5 lacs, which was the gift received by the assessee from her father, by treating the same as income u/s. 56(2)(vii), and; (b) difference in cash aggregating to Rs. 4,13,500/- by considering the same as cash credit u/s. 68. AO made addition of Rs.4,13,500/- by considering the same to be unexplained cash, credited in the books of account. The grievance of the appellant is that the same was done without show cause notice to the assessee, and additions were made u/s. 68 to the tune of Rs.4,13,500/- without any opportunity to the assessee. Consequently, penalty proceedings were also initiated with the issuance of notice u/s. 271(1)(c).
AO passed the assessment order u/s. 153A(1)(b) read with Section 143(3) on 01.09.2014. The assessee filed an appeal u/s. 249 of the Income Tax Act before CIT(A). He deleted the addition of Rs.1,50,000/-, being gift received from father, i.e., blood relative. However, so far as the addition u/s. 68 of the Income Tax Act was concerned, i.e. the net cash in hand of Rs. 4,13,000/- (Rs.4,66,500 minus Rs. 53,050/-) credited in the books of the assessee, the Commissioner of Appeals enlarged the scope of assessment by enhancing the cash in hand from Rs. 4,13,500/- to Rs. 4,66,500/-, i.e. by adding the original cash in hand, which was declared in return furnished u/s. 139, without issuing any show cause notice as mandated u/s. 251(2) of the Income Tax Act. The further appeal to the ITAT failed, and, consequently, the present appeal has been preferred by the appellant / assessee.
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