Upgrad LLM

assessment order

ASSISTANT MANAGER

Dear Friends, While going through some records I come acrossed one assessment order in which i have a doubt about the validity of assessment. the assessing officer nade the assessment for the year 2002-03. while going assessment the assessing office found that the assesee had constructed one house property in the year 1999-2000. for that the assessing office required the assessee furnish the source and assessee furnished the details. However the assessing office disallow and make addition to the extent of Rs.3,00,000/- in the AY 2002-03. my doubt is whether the assessing office is correct in making the additions in the AY 2002-03 or otherwise he has to make addition in the AY 2000-01 by opening the escapting assesssment? 

 
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ADVOCATE

Facts  stated:the assessing officer nade the assessment for the year 2002-03. while going assessment the assessing office found that the assesee had constructed one house property in the year 1999-2000. for that the assessing office required the assessee furnish the source and assessee furnished the details. However the assessing office disallow and make addition to the extent of Rs.3,00,000/- in the AY 2002-03. my doubt is whether the assessing office is correct in making the additions in the AY 2002-03 or otherwise he has to make addition in the AY 2000-01 by opening the escapting assesssment? 


Reply:The unexplained investment  made in the FY 1999-2000 cannot be lawfully assessed in the Assessment year 2002-03. However it is possible that the construction though commenced in the FY 1999-2000 was continued in theFY 2001-02 i
n which case the unexplained investment  made durin the FY 2001-02 can be assessed in the AY 2002-03. 

 
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Chartered accountant

The AO can make the addition only in the year in which the investment is made. You have stated that the construction tok place in the year 99-2000. If so it can be done only in that year since there is no material with AO for the year 2002-03. It is settled law that each year is independent and what happened before after the assessment year is not relevant.

 

Siva208@yahoo.com

 
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