|The Tax Publishers2020 TaxPub(DT) 5397 (Chd-Trib) : (2021) 186 ITD 0331
INCOME TAX ACT, 1961
Assessee had consistently claimed to be illiterate, evidenced by the fact that relevant documents were carrying a thumb impression. Assessee claimed to be purely an agriculturist having no other source of income. These facts remain unrebutted on record. Accordingly, issue regarding taxing of unexplained cash deposits by way of making addition under section 68 was remanded back to AO due to no proper tax compliance assistence afforded to illiterate assessee.
Income from undisclosed sources - Addition under section 68 - Cash deposits in bank deposits alleged as unexplained - No proper tax compliance assistance afforded to illiterate assessee
Assessee was found to have deposited an amount of Rs. 46,36,000 in specific bank account noted by the tax authorities. It was claimed that it was sourced from sale proceeds of rural agricultural land measuring 14 Kanal 15 Marla situated in village Fatehgarh Channa. AO noticed that an amount of Rs. 41,46,000 had been deposited in his bank account on 18-1-2011, whereas registration of land was done for a value of Rs. 14,75,000 on 17-1-2011. The amount of Rs. 26,71,000 was treated as unexplained cash deposits and AO made addition under section 68. Held: Tax Authorities had taken an easy route and placed an impossible burden upon assessee. It is the duty of tax authorities to assist tax compliance which means giving correct advice and following best practices. To attempt collecting tax on the basis of ignorance of the citizen is not expected from a tax administration in a developed economy. In the facts of instant case, assessee had consistently claimed to be illiterate, evidenced by the fact that relevant documents were carrying a thumb impression. Assessee claimed to be purely an agriculturist having no other source of income. These facts remain unrebutted on record. Accordingly, issue was restored back to CIT(A) with direction to pass speaking order in accordance with law after giving assessee a reasonable opportunity of being heard.
FAVOUR : Matter remanded.
A.Y. : 2011-12
IN THE ITAT, CHANDIGARH BENCH
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