The Gujarat High Court issued a returnable notice for final disposal of the deletion of the addition made by the Appellate Tribunal under section 68B of Income Tax Act, 1961 on Unexplained Investment.
The appeal against the order of the Income Tax Appellate Tribunal (ITAT) survey operation under Section 133A of Income Tax Act was carried out on the premises of M/s. Neotech Education Foundation.
Further, the incriminating materials had been found reflecting unaccounted payments made in cash for the land as well as unaccounted expenses incurred.
During the course of assessment proceedings, it was noticed by the Assessing Officer (AO) that a larger portion of land was proposed to be acquired for construction of an educational campus. A public notice was issued for title clearance.
Since there was no signature on the payment of Rs. 40 lacs, Rs. 21 lakhs, and Rs. 24 lacs made on July 18, 2014, the AO came to the conclusion that considering that the cheque payments were made in advance of the date, the cash payments must also have been made on time.
Further the AO added an additional Rs. 1.35 crores to the Rs. 5.68 crores that were taxed as unexplained investments under Section 69B of Income Tax Act.
The Commissioner of Income Tax (Appeals) [CIT(A)] held that Rs.1.35 crores for the assessment year 2014-15 cannot be sustained as the amount was not transacted and accordingly deletion was directed.
Further, following the request for the remand, reports from the AO had determined that no evidence had been discovered during the survey in the case of the appellant or during the course of the search in the case of the company’s directors.
The revenue filed an appeal, which the Appellate Tribunal, ITAT, denied while supporting the CIT(A)’s analysis and judgement.
The bench of Justice Sonia Gokani and Justice Sandeep N Bhatt issued a returnable notice for the final disposal of the issue.
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