The Income Tax Appellate Tribunal ( ITAT ), Bangalore recently recognized the failure by the Commissioner of Income Taxes (Appeals) ( CIT(A) )to adequately consider furnished documents in an income tax appeal pertaining to the setting off of a disputed Rs.41,44,319, and proceeded to remit the matter back to the CIT(A) for consideration of the documents already furnished.
The Appellant, Stephen Fernandes filed their returns of income declaring NIL income after adjusting a loss of Rs.41,44,319 against business profit from other sources, also calculated at Rs.41,44,319. Upon verification, the Assessing Officer ( AO ) observed that the Appellant-Assessee claimed to have earned profit of Rs.30,39,757 against mining business and after set off of a loss of Rs.32,42,811 from share transaction, worked out a net loss of Rs.2,07,011.
Consequently, the AO referred to Section 43(5) and 73(1) of the Income Tax Act, 1961 and assessed the total income of the Assessee at Rs.41,44,319. Aggrieved by the order of the First Appellate Authority, this present appeal has been preferred by the Assessee.
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Standing Counsel Ganesh R. Ghale, appearing for the Revenue averred before ITAT that the Assessee had been squarely incapable of substantiating the loss as was claimed by them and the business income arising from the mining activities, praying that the matter not be sent back for reconsideration.
Conversely, CA N. Ramesh representing the Assessee submitted that the First Appellate Authority had failed to consider the document adduced by the Assessee during the appellate proceedings on differing dates. Furthermore, the Appellant averred that the First Appellate Authority grossly confirmed the order of the AO without properly appreciating the documents that had been adduced by the Assessee.
The two-member Bench of the Income Tax Appellate Tribunal, Bangalore constituted by George George K.,Vice President And Laxmi Prasad Sahu, Accountant Member considered the submissions of either parties and observed that the Appellant had filed voluminous documents in paper books before the Bench and certified that no additional evidence had been filed.
In light of such observation, the ITAT allowed the appeal of the Assessee and remitted the matter back to the CIT(A), directing the Assessee to substantiate his case for proper adjudication and to be wholly cooperative in the adjudication proceedings before the CIT(A)
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