BISWANATH SOMADDER,J. - (1.) This appeal under section 260 of the Income Tax Act, 1961, was admitted on 09.10.2018. by an earlier Division Bench of this Court on questions no. 1 and 2 as framed in the memorandum of appeal. For convenience, the two questions are reproduced hereinbelow:- (1) "Whether, on the facts and circumstances of the case, Hon'ble ITAT was legally correct in its view that the assessee did not submit evidence or material at all before the lower Income Tax authorities in support of its claims for the deductions relating to, operating expenses, the cash deposit in bank and agricultural income. (2) Whether on the facts and circumstances of the case and keeping in view the fact that the assessee had, in fact, submitted written submissions dated 31.01.2017 before the CIT(A) alongwith additional evidences which were admitted by the CIT(A) and further evidence, viz. Confirmatory letter of salary paid during the relevant period submitted before the ITAT, was the ITAT legally and judicially justified in its findings that the assessee did not explain the operating expenses, the agricultural income or the deposit in bank accounts, and thereby in dismissing the assessee's appeal."
(2.) Before we proceed to deal with the two questions, we need to consider the facts of the instant case, which have been recorded in the assessment order dated 05.01.2016. For convenience, the assessment order is reproduced hereinbelow in its entirety:- "In this case return has been filed on 30.3.2014 showing an income of Rs. 3,01,370/- accordingly the case was processed U/s 143(1) on 22.06.2014. The case was selected under CASS for scrutiny. A notice U/s 143(2) issued on 05.09.2014 and duly served by speed post as well as by inspector of this ward. Notice U/s 142(1) issued on 09.04.2015 and 29.04.2015 fixing 16.04.2015 and 11.05.2015 but no compliance was made by the assessee. A show cause notice U/s 271(1)(b) issued on 22.05.2015 for 28.05.2015. On 27.05.2015 an application for adjournment received. The case was adjourned to 15.06.2015. On the day Shri K. K. Agarwal, C.A. attended and filed reply with computation of income, copy of bank accounts etc. The source of income is income from remuneration, interest from firm and income from other sources. A notice U/s 142(1) issued on 24.06.2015 for 02.07.2015. An application for adjournment filed by the assessee on 01.07.2015. Case adjourned for 17.07.2015 but no compliance was made. Notice U/s 271(1)(b) issued for 18.08.2015 but the fate is same. A penalty for Rs. 10000/- has been imposed vide order dated 28.08.2015 and duly served by speed post. Notice U/s 142(1) issued on 07.09.2015, 29.09.2015, 05.10.2015 for 14.09.2015, 07.10.2015 and 16.10.2015 but no compliance was made as required vide notices. A show cause notice issued on 15.10.2015 for 21.10.2015 and 09.11.2015 but the fate is same. As the assessee has failed to make compliance of the notices and furnish details as required.
(3.) Therefore the assessment is completed as under:- Income as per return--- 3,01,370/- Addition (due to non - submission of evidences) 1. Deduction claimed as Operating expenses U/s 57 : 5,94,630/- 2. Deduction claimed as Tution fee : 45,080/- 3. Deduction claimed U/s 80QQB : 1,50,500/- 4. Agricultural Income : 1,50,000/- (Treated as other sources income) 5 Cash deposited in Bank (not explained): 1,90,600/- ------------- 11,30,810/- 11,30,810/- ----------------- Total Taxable Income--14,32,810/- ----------------- Assessment is completed on an income of Rs. 14,32,810/-. Issue challan and notice of demand. Charge interest U/s 234A, 234B and 234C as per rule. As the assessee furnished inaccurate particulars of his income hence penalty proceedings is being initiated separately. Notice U/s. 271 (1) (c) issued." ;