Santosh Kumari Sahu v. The Income Tax Officer

Parties Involved

Facts Summary

The brief facts of the case are that the Assessing Officer, on the basis of information available with the Department, noted that the assessee had entered into certain transactions through his bank accounts maintained with State Bank of India and Bank of Baroda. In this view of the matter, the Assessing Officer, after recording reasons and obtaining necessary approval from the Competent Authority, initiated proceedings under section 147 of the Income Tax Act, 1961 by issuing notice dated 27.03.2021 under section 148 of the Act. The assessee was required to file the return of income, as no return of income was filed by the assessee under section 139 of the Act. In response to the said notice, the assessee did not file the return of income. Thereafter, the Assessing Officer issued notice dated 22.11.2021 under section 142(1) of the Act, but still there was no response from the side of the assessee. Subsequently, assessment proceedings were assigned to the Faceless Assessment Unit (FAC), who issued notices under section 142(1) of the Act to the assessee, but there was no compliance from the assessee. In the absence of any response from the side of the assessee, the FAC initiated best judgment assessment under section 144 of the Act by issuing notice dated 23.02.2022. The Assessing Officer, FAC completed the assessment under section 144 read with 147 of the Act by making the following additions: (i) Rs.7,04,400/- under section 69A of the Act. (ii) Rs.1,48,738/- being income from …

Legal Issues

• 1. Whether the Ld. AO was justified in initiating action u/s 147 on the basis of banking transactions and issuing notice u/s 148?
• 2. Whether the Ld. AO was justified in making the addition of Rs.704400 ignoring totally the facts of closing balance of Rs.9773=11 (Dr) in, (Bank Overdraft settlement)account?
• 3. Whether the Ld. AO was justified in making addition u/s 69A of the Act as the ingredients of section 69A is not applicable in the case of appellant?
• 4. Whether the bank account is not the books of account of the appellant and hence no addition u/s 69A of the Act could have been made by the Ld. AO on such basis?
• 5. Whether the Ld. AO was not justified in applying provisions of section 115BBE of the Act?

Judgment Outcome

Decided in favour of Assessee.

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