Addition us 68 remanded back for short time lag between inquiry initiation and conclusion when the evidence was to be produced in just 10 days

Addition us 68 remanded back by ITAT for short time lag between inquiry initiation and conclusion when the evidence was to be produced in just 10 days.

ABCAUS Case Law Citation:
1781 2016 (06) ITAT

Brief Facts of the Case:
During the assessment proceedings, the copy of the cash book was produced before the AO on 14.11.2011. From the copy of the cash book, the AO found that the assessee had taken loan in cash from 36 parties aggregating to Rs.6,50,478/-. The AO directed the assessee to submit source of cash deposits in the bank. The details with regard to the cash taken from 36 persons reflected in the cash book were to be submitted by 24.11.2011. The assessee failed to submit details, and accordingly, the AO had passed assessment order on 26.12.2011. He made addition of Rs.6,50,478/-.

Important Excerpts from ITAT Judgment:

we are of the view that the time lag between the inquiry initiated by the AO and the conclusion of that inquiry was very short. Fact of receipt of cash came to the notice of the AO on submission of cash book, which was submitted on 14.11.2011. The evidence was to be produced by 24.11.2011 in just 10 days. It is not possible to submit the details as called for by the AO.

There is no explanation at the end of the assessee as to why she has not appeared before the CIT(A), but, taking into consideration totality of the circumstances, i.e. time period granted by the AO to explain her position during the assessment proceedings, we deem it appropriate to set aside both the orders and restore this issue to the file of the AO for fresh adjudication. The assessee will be at liberty to submit any detail in support of her stand.

short time lag between inquiry initiation and conclusion

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