K Hari Shankar Goud, Hyderabad vs Department Of Income Tax

This is an appeal preferred by the Revenue against the order of the CIT (A)-III, Hyderabad, dated 8th September, 2014 relating to A.Y 2009-10 and cross objection in support of order of the CIT (A).

Page 1 of 4 ITA No.1819 of 2014 Hari Shankar Goud Hyd.

2. Briefly stated, the assessee is an individual, deriving income from house property filed his return of income for A.Y 2009-10 on 24.11.2009 declaring total income of Rs.1,89,800. In view of the fact that the assessee had deposited cash in his two accounts i.e. ICICI Bank and Andhra Bank aggregating to Rs.82,95,500, the case was selected for scrutiny. AO during the course of the assessment proceedings came to the conclusion that the cash deposits comprises of an amount of Rs. 41,08,000 being the sale proceeds of Plot No.4, S.No.148, Kondapur (V) Hyderabad and had also taken into consideration the short term capital gain derived therefrom. AO completed the assessment on 30.12.2011 u/s 143(3) determining total income at Rs.87,61,330. On appeal it was submitted before the CIT (A) that the addition of Rs.41,08,000 which forms part and parcel of Rs.82,95,000 is not correct.

3. It was pointed out that the AO concluded that the assessee had not explained properly the sources of cash deposits. It was submitted that the observation of AO is vague and the AO had failed to take into cognizance, the explanations given by the assessee and the order of AO is not a speaking order as no defects were pointed out by the AO. It was further pointed out that the AO has not taken into consideration the cash withdrawals made from both the bank accounts which also constitute the sources of cash deposits and hence the conclusion that no proper explanation was given for the sources of cash deposits is erroneous and is not based on the facts of the case. It was also stated that the AO had not considered the fact that out of the cash deposits, a sum of Rs.1,89,800 being the rent derived

Page 2 of 4 ITA No.1819 of 2014 Hari Shankar Goud Hyd.

from two properties is also included and hence the addition is unwarranted.

4. The ld CIT (A) was of the opinion that the matter requires examination by the AO with reference to the assessment records and further evidences and therefore, directed the AO to examine the matter and allow the same, if properly explained. The CIT (A) partly allowed the appeal preferred by the assessee.

5. Aggrieved, the Department is in appeal before us raising the following grounds:

"1. The ld CIT (A) has erred both on facts and law.

2. The ld CIT (A) ought to have appreciated the fact that the onus to explain and substantiate the credits in the bank account is on the assessee, which he had failed to do so.

3. The ld CIT (A) ought to have appreciated the fact that the assessee has failed to disclose the income from capital gains on sale of property, which was brought to tax by the AO.

4. The ld CIT (A) ought not to have remitted back the above issues to the AO for re-verification, as the CIT (A) does not have power to set aside the issues to the AO as per provisions of section 251(1) of the Act.

5. The ld CIT (A) ought to have appreciated the fact that the AO does not have power to revisit the assessment again on the concluded assessment and cannot gain that power from the order of the CIT (A) which is not authorised by the provisions of the I.T. Act".

Page 3 of 4 ITA No.1819 of 2014 Hari Shankar Goud Hyd.

6. We have heard both the parties. Since the CIT (A) erred in remitting the issues back to the AO for re-verification and since the CIT (A) is not authorised under the provisions of section 251(1) of the Act set aside the assessment again, we consider it appropriate to set aside the issue to the file of the AO for deciding the issue afresh after duly considering the obejction/explanation of assessee.

7. In the result appeal in ITA No.1819/Hyd/2014 is allowed for statistical purposes and the cross objection No.14/Hyd/2015 supporting the order of the CIT (A) is dismissed.

Order pronounced in the Open Court on 17thJune, 2015.

Sd/- Sd/- (B. Ramakotaiah) (Asha Vijayaraghavan) Accountant Member Judicial Member

Hyderabad, dated 17th June, 2015.

Vnodan/sps Copy to:

1. Income Tax Officer Ward 8(3) D Block, 8th Floor, IT Towers, AC Guards, Hyderabad

2. Sri K. Hari Shankar Goud, 505 CBR Estate, Madinaguda, Hyderabad

3. The CIT(A) - III Hyderabad

4. The CIT II Hyderabad

5. The DR, ITAT, Hyderabad

6. Guard File

By Order

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