The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer (AO) to consider fresh evidence in the unexplained expenditure addition under section 69C of the Income Tax Act, 1961.
The assessee, Ambuja Neotia Hotel Ventures, had appealed against the order passed by the Commissioner of Income Tax (Appeals) for the assessment year (AY) 2014-15.
The ITAT observed that the ground No. 1 raised by the assessee was a general one that required no adjudication.
The assessee, in this case, had raised several grounds, and on one of the grounds the assessee had challenged the order of CIT(A) in confirming the addition of Rs. 65,97,435 under Section 69C of the Act.
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During the process of the assessment proceedings, the ITAT called for the details from the assessee in respect of party-wise details of certain expenses, which were submitted by the assessee inter alia submitting the details of construction/contractors charges, infrastructure development expenses, repairs to buildings, and repairs to others.
By going through the details, the AO noted that the assessee had paid Rs. 1.30 crores to M/s Bright Construction towards construction and other expenses.
It is to be duly noted that when differences arose between the assessee and the AO, the assessee furnished the reconciliation statement with revised details and evidence which the ld. AO did not consider and added the difference u/s 69C of the Act.
The bench noted that the details and evidence which were later on submitted by the assessee were not considered by the AO.
The bench noted that the issue raised by the assessee requires re-examination by the AO as fresh evidence and re-conciliation statements were published by the AO.
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The bench restored the matter back to the AO and directed that the reconciliation along with the revised details should be taken into account. The ITAT, comprising Pradip Kumar Choubey (Judicial Member) and Rajesh Kumar (Accountant Member) allowed the assessee’s appeal for statistical purposes.
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