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Facts
Information was received that the assessee deposited cash and non-cash amounts in his bank account. The assessee failed to file a return of income, leading to a notice under Section 148. The assessee subsequently filed a return declaring total income, but the AO added Rs. 3 lacs to the total income as unexplained. The CIT(A) sustained the addition.
Held
The Tribunal held that the addition of Rs. 3,00,000/- made in the hands of the assessee was not sustainable as the source of the funds should have been explained by the assessee's daughter and wife, not solely by the assessee himself.
Key Issues
Whether the addition of Rs. 3 lacs made by the AO on account of alleged unexplained deposits in the assessee's bank account is justified when the assessee claims the funds belong to his wife and daughter.
Sections Cited
148, 69A
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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’’ : NEW DELHI
Asstt. Year : 2015-16 UTTAM SINGH, VS. ITO, WARD 4(1), WARD NO. 11, NEAR PRAM GURGAON. DAS MANDIR, JAJUKA MEWAT AT GURGAON-122107 HARYANA (PAN: BENPS8665F) (Appellant) (Respondent) Appellant by : None Respondent by : Sh. Sangeet Bansal, Sr. DR Date of Hearing 05.08.2025 Date of Pronouncement 05.08.2025 ORDER This appeal by the assessee is emanating from the order of the Ld. Commissioner of Income Tax (Appeals), NFAC, Delhi dated 23.04.2025 pertaining to assessment year 2015-16. The solitary issue is relating to sustaining the addition of Rs. 3,00,000/- made by the AO.
At the time of hearing, none appeared on behalf of the assessee, despite issue of notice, hence, we are proceeding exparte qua the assessee.
After hearing the Ld. DR and perusing the records, I note that the assessee is an individual and is a Ex-serviceman and is earning income through pension. In this case information was received from the office of the DDIT (Inv.) Unit-1, Gurgaon that the assessee has deposited cash of Rs. 85,000/- and non-cash deposits of Rs. 2,42,162/- in his ICICI bank account during the year under consideration. As the assessee had failed to file the return of income it was treated as unexplained income of the assessee from undisclosed sources. In view of this fact, the case of the assessee was reopened by issue notice u/s. 148 of the Act and in response to the said notice, the assessee filed the return of income on 24.12.2021 declaring total income of Rs. 2,54,280/-. AO noted that the assessee has only furnished the confirmation from the daughter without any evidences of earning income by his daughter. AO further noted that as the assessee failed to prove the genuineness of the transaction held of cash deposits in his bank account, thus added the amount of Rs. 3 lacs to the total income u/s. 69A of the Act for the year under consideration. Aggrieved with the action of the AO, assessee preferred the appeal before the Ld. CIT(A), who vide his impugned order dated 23.04.2025 sustained the addition by dismissing the appeal of the assessee. Against the order of the Ld. CIT(A), assessee is in appeal before me. Ld. DR relied upon the orders of the authorities below.
At the outset, it is noted that it was the contention of the assessee made in the grounds of appeal that AO is not justified in making addition of Rs. 3 lacs as the money does not belong to the assessee and he has no control on this money but it belongs to the wife and daughter of the assessee. It was the further contention that lower authorities do not appreciate the fact that only assessee is not the sole owner of funds in the said bank accounts and also did not appreciate the fact that the 2 | P a g e source of cash of daughter and wife in the form of requisite evidences is to be explained from the daughter and wife and not by the assessee himself. In view of the aforesaid discussions, I am of the considered view that source of Rs. 3,00,000/- has also to be explained by the assessee’s daughter and his wife, hence, addition of Rs. 3,00,000/- made in the hands of the assessee is not sustainable in the eyes of law, hence, the same is deserved to be deleted. Accordingly, I set aside the orders of the authorities below and delete the addition of Rs. 3,00,000/-.
In the result, the Assessee’s appeal is allowed. Order pronounced in the Open Court on 05.08.2025.