SANDEEP KUMAR,ROHTAK vs. ITO WARD -03, ROHTAK
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Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC’ NEW DELHI
IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘SMC’ NEW DELHI
SHRI SAKTIJIT DEY, JUDICIAL MEMBER
ITA No.3887/Del/2019 Assessment Year: 2010-11
Shri Sandeep Kumar, Vs. ITO, Ward-03, S/o Ishwar Singh, Rohtak Village Bohar, near Athgama Bhawan, Rohtak (Hr.) PIN: 124021
PAN :AGIPK5304P (Appellant) (Respondent)
Appellant by Shri Apoorva Bhardwaj, CA Respondent by Shri Om Parkash, Sr. DR
Date of hearing 08.06.2022 Date of pronouncement 31.08.2022
ORDER This is an appeal by the assessee against order dated 30.11.2017
of learned Commissioner of Income-Tax (Appeals)-2, Gurgaon
pertaining to assessment year 2010-11.
The dispute in the present appeal is confined to addition of an
amount of Rs.25,20,550 as unexplained cash credit under Section 68
of the Income-Tax Act, 1961.
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Briefly, the facts are that the assessee is a resident individual and
stated to be deriving income from salary. For the assessment year
under dispute, assessee filed his return of income on 13.04.2010
declaring income of Rs.2,49,247. Assessee’s case was selected for
scrutiny. In course of assessment proceedings, the Assessing Officer
noticed that during the relevant year, assessee had deposited cash
aggregating to Rs.25,20,250 in two saving bank accounts held with
Kotak Mohindra Bank, Rohtak and Central Bank of India, Rohtak.
Noticing this, the Assessing Officer called upon the assessee to
explain the source of cash deposits as well as the purpose for which
the withdrawals were made from the bank accounts. In response to the
query made, the assessee furnished his reply explaining the source of
the cash deposits. It was submitted by assessee that the cash deposits
were made out of advances received from various individuals. After
considering the submission of assessee, the Assessing Officer called
upon the assessee to produce the persons from whom money was
received and also to prove their creditworthiness and genuineness of
the transaction. As observed by the Assessing Officer, assessee not
only failed to produce the concerned parties but did not file any
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evidence to prove the identity, creditworthiness of the persons
advancing money as well as the genuineness of the transaction.
Alleging that the assessee failed to explain the source of cash deposits
in the bank accounts, the Assessing Officer added back the amount to
the income of the assessee by invoking the provisions of section 68 of
the Act. Though, the assessee contested the aforesaid addition before
learned Commissioner (Appeals), however, he was unsuccessful.
Before me, learned counsel appearing for the assessee submitted
that before the departmental authorities, assessee had furnished
various documentary evidences to explain the source of the cash
deposits which were not at all considered by them. He submitted,
though, from the stage of assessment proceedings itself assessee has
consistently taken the same stand to explain the source of cash
deposits and has furnished documentary evidences to support the
source of cash deposits, however, departmental authorities have failed
to consider the evidences in proper perspective. He submitted,
assessee has received an amount of Rs.10,00,000 towards his share in
sale of ancestral land which was deposited in savings bank account
held with Central Bank of India. As regards, the deposits of
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Rs.15,05,250 in Kotak Mohindra Bank, he submitted, the amount was received from various persons for payments, to Paras Finance Co. He submitted, affidavits of the persons advancing money to the assessee were furnished before the departmental authorities. Thus, he submitted, on the face of such corroborative evidences, which were not found to be false, the addition could not have been made. Without prejudice, he submitted, no addition under section 68 of the Act could have been made on the basis of savings bank account statement as, it cannot be considered to be books of accounts maintained by the assessee. Therefore, the conditions of section 68 of the Act are not fulfilled. In support of such contentions, he relied upon the following decisions: • CIT vs. Mayawati [2011] 338 ITR 563 (Delhi High Court); • Baladin ram vs. CIT [1969] 71 ITR 427 (Supreme Court); • CIT vs. Bhaichand N. Gandhi [1983] 141 67 [Bombay High Court]; • Sh. Om Prakash vs. ITO, ITA No.1325/Del/2011, Date of decision: 11.08.2016 (Delhi – Trib.); • Amitabh Bansal vs ITO [2019] 175 ITD 401 (Delhi – Trib.).
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Learned Departmental Representative strongly relied upon the
observations of the Assessing Officer and learned Commissioner
(Appeals). Further, he submitted, assessee’s contention that no
addition under Section 68 of the Act can be made, basis bank
statement, is unacceptable in view of the decision of coordinate Bench
in case of Shri Janak Goel vs. DCIT – ITA Nos. 937 & 938/Del/2012
dated 13.05.2019.
I have considered rival submissions in the light of decisions
relied upon and perused the material available on record.
Undisputedly, in the year under consideration, assessee had
made cash deposits of Rs.25,20,000 in two savings bank accounts. On
an analysis of the bank statements, it is observed that assessee has
deposited cash of Rs. 10,00,000 in the account held with Central Bank
of India at one go on 20.12.2019. It is the case of the assessee that the
amount represented assessee’s share in consideration received on sale
of ancestral land. On a perusal of the conveyance deed, a copy of
which is placed in the paper book, it is observed that the said deed was
executed on 06.01.2010. Therefore, assessee’s claim that an amount of
Rs.10,00,000 was received towards sale consideration of the land prior
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to execution of conveyance deed and deposited in bank account on
30.12.2019, to some extent is believable. Hence, benefit of doubt can
be given to the assessee. This is so, because, the Assessing Officer
neither in course of assessment proceedings nor during remand has
been able to dislodge assessee’s claim by making any inquiry.
Therefore, I am of the view, cash deposits of Rs.10,00,000 in the
account maintained with Central Bank of India stands explained.
As regards, the balance amount of Rs.15,20,000 deposited in the
account maintained with Kotak Mohindra Bank, Rohtak, on an
analysis of the bank statement, it is evident that assessee has deposited
cash on various occasions during the year under consideration. In fact,
the details of such cash deposits are depicted in the assessment order.
It has been explained by assessee before the departmental authorities
that cash was received from various persons for making payment to
Paras Finance Co. Though, in course of assessment proceedings
assessee could only furnish the name of the persons from whom the
amounts were received, however, in course of proceedings before the
first appellate authority, assessee had furnished certain additional
evidences, being affidavits of the persons from whom the money was
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received. Though, in the remand report, the Assessing Officer accepts
that the persons filing affidavits have confirmed that they have
advanced money to assessee, however, he has not accepted their
version by simply stating that assessee is making a concocted story. It
is trite law, affidavits carry some evidentiary value. Therefore, before
rejecting the affidavits as false, the Assessing Officer must make
reasonable enquiry with the persons filing affidavits. This has not been
done by the Assessing Officer in the present case. Further, on an
analysis of the bank statement, it is observed that the assessee has not
only made cash deposits but has also made cash withdrawals on
various dates. In fact, the Assessing Officer also accepted the
aforesaid factual position. However, he didn’t make addition on peak
basis on the plea that period of circulation of cash cannot be
ascertained. This, in my view, is unacceptable. When the bank
statement was available before the Assessing Officer, he cannot again
take the plea that the period of circulation of money is not ascertained.
Thus, on an overall consideration of facts and material on record, I am
of the view that, even, the addition of Rs.15,20,000 representing cash
deposits in account with Kotak Mohindra Bank, Rohtak is
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unsustainable. Since, I have decided the issue on merits by deleting
the addition made by the Assessing Officer, I do not intend to dwell
upon the issue whether the provisions of section 68 of the Act are
applicable to cash deposits made in the bank accounts.
In view of the aforesaid, the addition made by the Assessing
Officer stands deleted. Grounds are allowed.
In the result, the appeal is allowed.
Order pronounced in the open court on 31st August, 2022. Sd/- (SAKTIJIT DEY) JUDICIAL MEMBER Dated: 31stAugust, 2022. Mohan Lal Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi
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Sl. No. Particulars Date 1. Date of dictation (Order drafted through Dragon software): 23.08.2022 2. Date on which the draft of order is placed before the 24.08.2022 Dictating Member: 3. Date on which the draft of order is placed before the other Member: 4. Date on which the approved draft of order comes to 26.08.2022 the Sr. PS/PS: 5. Date of which the fair order is placed before the 29.08.2022 Dictating Member for pronouncement: 6. Date on which the final order received after having 31.08.2022 been singed/pronounced by the Members: 7. Date on which the final order is uploaded on the 31.08.2022 website of ITAT: 8. Date on which the file goes to the Bench Clerk 31.08.2022 9. Date on which files goes to the Head Clerk: 10. Date on which file goes to the Assistant Registrar for signature on the order: 11. Date of dispatch of order:
