Case Law Details
Nagappan Arunachalam Vs ITO (ITAT Delhi)
The ld. CIT(A) has sustained an addition u/s 69A equal to 50% of the peak balance in HSBC accounts jointly held with the spouse. The Ld. CIT(A) erred in holding that the Appellant was not able to rebut the issues raised by the AO during remand proceedings as the Assessee has not filed narrations/nature of credit and not submitted computation of income tax filed in USA/UK to substantiate the credits were not taxable in India.
Before us it was submitted that the complete narration of each and every entry in the 3 accounts were produced before the learned CIT(A). Copy of the statement showing narrations has been perused by us. The original bank statement of all 3 accounts are examined. On examination it can be seen that almost all the credits were inter-account transfers including from wife’s account. Relevant parts of these bank accounts of the Appellant and that of his spouse is part of paperbook. There were no items in the nature of income save and except sale of securities for US$ 37,000 ( 13/4/16 – US$ 19,000 and 10/6/16 – US$ 18,000) which has only resulted in a loss of US$ 1,940 as evidenced by the E*Trade statement set out earlier. With regard to the US Tax returns the assessee filed his US Tax Returns and provided copies of the same. From submissions before us it can be observed that there are no entries in the nature of income.
In view of the explanations provided, backed by bank statement of all 3 banks along with narrations, as well as the US Returns, we hold that no part of the balance in the banks should be added u/s 69 or 69A.
FULL TEXT OF THE ORDER OF ITAT DELHI
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