SHRI JIGNESH VALLABHBHAI PATEL,BARODA vs. THE INCOME TAX OFFICER, WARD-5(1), BARODA

The assessee has raised following grounds of appeal:- “1. Ld. CIT (A) erred in law and on facts in confirming action of AO treating cash deposits of Rs. 2, 16, 000/- in the bank account of the appellant as unexplained investment. Ld. CIT (A) ought to have deleted addition by accepting documentary Page No 2. Shri Jignesh Vallabhbhai Patel vs. ITO evidence explaining source of cash deposit as from sale of vegetables from land owned by appellant's father. It be so held now.

2. Ld. CIT (A) erred in law and on facts in confirming action of AO treating cash deposit of Rs. 5, 44, 800/- in the bank account of the appellant as unexplained investment. Ld. CIT (A) erred in not appreciating that cash withdrawals from bank account of appellant's mother as source of deposit. Ld. CIT (A) ought to have accepted source of cash deposit when her bank statement reflected all withdrawals being numbered also stating name of the appellant not necessitating any confirmation. It be so held now.

The fact in brief is that assessee has not filed original return of income u/s. 139(1) of the act. As per the information obtained from the AIR transaction, the assessing officer noticed that assessee has deposited cash of Rs. 12,13,400/- during financial year relevant to assessment year under consideration. A notice u/s. 148 of the act was issued to the assessee. In response to the notice, the assessee has filed return of income on 20th July, 2012 for assessment year 2009-10 declaring total income at Rs. 31,260/-. In the course of assessment, the assessee was asked to furnish detail of sources of cash deposit made in the bank account. The assessee submitted that source of cash deposit was the amount received from his mother and father from their agricultural income and the assessee had managed their bank account as Power of Attorney holder because his parents were settled in U.S.A. The assessing officer has not agreed with the assessee stating the assessee has not given satisfactory explanation with relevant supporting evidences. Consequently, the assessing officer has treated cash deposit to Page No 3 Shri Jignesh Vallabhbhai Patel vs. ITO the extent of Rs. 10,68,800/- as unaccounted investment and added to the total income of the assessee.

Aggrieved assessee has filed appeal before the ld. CIT(A). The ld. CIT(A) has dismissed the appeal of the assessee reiterating the reasons stated by the assessing officer.

We have heard the rival contentions and perused the material on record. During the course of assessment, the assessee had brought to the knowledge of the assessing officer that he was holding power of attorney on behalf of his father who was staying in USA and having agricultural land of 4.6934 hectares. The assessee explained that loan of Rs. 1,40,800/- was obtained from the Baroda Co-operative Bank on the basis of power of attorney and also enclosed evidences of loan provided by Bank of Baroda as per annexure 2 of the paper book submitted during the course of appellate proceedings. The assessee has also submitted a copy of sale bill of sale of cotton of Rs.1,95,353/- in the name of his father as per annexure 4 of the paper book. This information was also submitted before the lower authorities. It is also submitted that assessee has obtained power of attorney from his mother for operating her bank account with Bank of Baroda. In support of the same, the assessee has submitted detail of holding of power of attorney on their behalf for managing their bank accounts along with copies of bank statements indicating cheque number issued in favour of the assessee as payee with supporting evidences. The assessing officer has not contravened the supporting material furnished by the assessee explaining the source of cash deposit in the bank account. Therefore, we restore this case Page No 4 Shri Jignesh Vallabhbhai Patel vs. ITO to the file of assessing officer for deciding the issue afresh after objectively verification and examination of the detailed information and relevant supporting material demonstrating the source of cash as briefly stated above in this order. Therefore, the case is set aside to the file of assessing officer for deciding afresh as directed above after affording adequate opportunity to the assessee.

In the result, all the grounds of the appeal of the assessee are allowed for statistical purposes.