PRAGATI PALLAVI,PATNA vs. ITO, WARD-5(4), PATNA

The sole grievance of the assessee is that the ld. CIT(A) has erred in confirming the addition for undisclosed cash deposit u/s 69A of the Act at Rs. 13,50,000/- deposited during the demonetization period.

Facts in brief are that the assessee is an individual. Income of Rs.8,40,280/- declared in the return for Assessment Year 2017-18. On the basis of the reason that cash of Rs.18,50,000/- has been deposited in the bank account held by the assessee with Kotak Mahindra Bank during demonetization period, assessee’s case was selected for scrutiny followed by serving of notices u/s 143(2) and 142(1) of the Act. During the course of assessment proceedings, it was submitted that the assessee holds a joint account her husband in Kotak Mahindra Bank A/c No.

Assessment Year: 2017-18 Pragati Pallavi 2 0112474294 and during demonetization period Rs.18,50,000/- was deposited and the bifurcation of the said sum was stated that Rs.8,50,000/- was deposited by her husband who is a practicing Advocate, Rs.5,00,000/- was on account of Streedhan and balance Rs.5,00,000/- was out of past available cash/accumulated savings/gifts received over the years including sale of old jewellery. The ld. Assessing Officer was partly satisfied with these arguments and did not make any additions for Rs.5,00,000/- accepting them to be the accumulated savings of both the joint holders but for the remaining sum of Rs.13,50,000/-, addition was made u/s 69A of the Act. 3.1. Aggrieved the assessee preferred appeal before the ld. CIT(A) but failed to succeed.

Aggrieved the assessee is now in appeal before the Tribunal. The ld. Counsel for the assessee referring to the written submissions and paper book submitted that assessee’s husband is an Advocate registered with the Bar Council of Delhi and the gross receipts declared by him in his income tax return is Rs.48,87,000/- and he has also given an affidavit stating that Rs.8,50,000/- was his professional receipts, which he deposited in the bank account jointly held with his wife and for the remaining sum of Rs.5,00,000/-, it was submitted on behalf of the assessee that the same is on account of accumulation of past savings and streedhan.

On the other hand, the ld. D/R vehemently argued supporting the orders of the lower authorities.

We have heard rival contentions and perused the material placed before us. Addition for unexplained cash deposited of Rs. 13,50,000/- u/s 69A of the Act is under challenge before us. Out of the alleged sum of Rs.8,50,000/- is claimed to be out of the professional receipt of assessee’s husband who is engaged in the profession as an Advocate with Bar Council of Delhi. We have gone through the Income Tax return of the assessee’s husband, namely, Atish Kumar Vatts, wherein gross total income of Rs.29,34,507/- has been declared and in the schedule to ITR 4 available at page 15 of the paper book, we notice that gross receipts are shown at Rs. 48,87,000/- and assessee has opted for presumptive income u/s 44ADA of the Assessment Year: 2017-18 Pragati Pallavi 3 Act, thereby offering 50% of the gross receipt as income at Rs.25,16,000/-. We also notice that Mr. Atish Kumar Vatts, has even sworn in an affidavit stating that Rs.8,50,000/- is his professional receipts and the same has been offered to tax. Since the ld. D/R failed to controvert these facts, we accept the contentions of the ld. Counsel for the assessee and hold that the source of Rs.8,50,000/- has been explained and since the same has been offered to tax by the assessee’s husband in the ITR being part of the gross receipts for the year, the same cannot be added in the hands of the assessee. Thus, the addition for Rs.8,50,000/- u/s 69A of the Act is deleted.

As regards the remaining amount of Rs.5,00,000/- is concerned, we notice that the assessee has claimed it as streedhan, past available cash/accumulated savings/gifts received over the years including sale of old jewellery. The Assessing Officer has already given the relief of Rs.5,00,000/- out of the total cash deposit of Rs.18,50,000/- referring them to be the past personal savings at Rs.2,50,000/- each in the hands of the assessee as well as her husband. Further there is no evidence filed by the assessee about the sale of old jewellery. However, considering that the assessee being a lady and some gift are received on auspicious and religious occasions, we, in addition to the relief of Rs.2,50,000/- granted by the Assessing Officer, further give a relief of Rs.1,50,000/- out of the impugned addition of Rs.5,00,000/- and confirm the remaining amount.

Accordingly, out of the total impugned addition of Rs.13,50,000/-, assessee gets relief of Rs.10,00,000/- and balance addition of Rs.3,50,000/- is sustained.

In the result, appeal of the assessee is partly allowed. Order pronounced in the Court on 5th June, 2023 at Kolkata. (RAJPAL YADAV) (MANISH BORAD) VICE-PRESIDENT ACCOUNTANT MEMBER Kolkata, Dated 05/06/2023 *SC SrPs