No Deletion of Income Tax Addition Merely on Technical Ground of Wrong Mentioning of Provision by AO: ITAT [Read Order]

The Delhi Bench of Income Tax Appellate Tribunal (ITAT) held that the additions cannot be deleted merely on technical ground that the Assessing Officer (AO) mentioned Section 68 instead of Section 69 of the Income Tax Act, 1961.

The assessee in this present case is Smt. Gloria Eugenia Rynjah. This is not the first round of litigation as in first round when the addition was made the Commissioner of Income Tax (Appeals) [CIT(A)] deleted the addition and the revenue preferred an appeal before this Tribunal and this Tribunal in ITA No.316/Del/2012 restored the issue back to the files of the AO to decide the same in accordance with law.

In the fresh assessment proceedings the AR (Authorised Representative of the assessee) of the assessee furnished a copy of will which was different from what was filed in the first round of litigation . The assessee was further asked to explain the delay in sending the money to Delhi and why there were deposits in amounts less than Rs. 50,000/-.

In further query he submitted that the bank charges, handling charges of cash deposit exceeding Rs.50,000, therefore, to avoid bank charges cash was deposited in amounts less than Rs.50,000. The explanation of the assessee did not find any favour with the AO who completed the assessment by making the addition of Rs.2002801 under Section 68 of the Income Tax Act.

Aggrieved by the order the assessee filed an appeal before the CIT(A) which upheld the order of AO. Further aggrieved the assessee filed an appeal before the Tribunal.

The AR stated that the addition cannot be made under Section 68 of the Income Tax Act in as much as assessee does not maintain any books of account and the cash was found to be deposited in the bank account, therefore, provisions of Section 68 of the Income Tax Act do not apply.

Further it was submitted that the amount of Rs.2002801 emerged out of the sale proceeds of land at Meghalaya, since the sources has been duly explained there is no reason for making the impugned addition.

The Departmental Representative relied on the decision of AO.

The Bench comprising of N. K. Billaiya, Accountant Member and Yogesh Kumar US, Judicial Member observed that there was no dispute that some land was sold at Meghalaya in 1989 for a consideration of Rs.24.50 lakhs. It is also not in dispute that the sale consideration was kept by the cousin brother of the assessee at Meghalaya. What is not understandable and is beyond the human probability that the brother of the assessee kept such a huge amount at Meghalaya since 1989 till 2006.

It is also not understandable nor it has been proved before any authority including us as to how such a huge amount travelled in cash from Meghalaya to Delhi. The logic behind deposit of cash of Rs. 49,000/- each time in the bank account is also not justified, the bench observed.

It was held that the additions cannot be deleted merely on technical ground that the AO mentioned Section 68 instead of Section 69 of the Income Tax Act.

It was observed that the peculiar facts of the case discussed here in above do not justify any relief on this count. Therefore the Bench found no reason to interfere with the findings of the CIT (A).

Thus the appeal of the assessee was dismissed.

To Read the full text of the Order CLICK HERE

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