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Facts
The assessee's appeal arises from an order confirming additions made by the Assessing Officer (AO) for AY 2012-13, related to cash deposits and credit entries in her bank account. The AO made additions of Rs. 19,63,000/- for cash deposits and Rs. 9,51,906/- for credit entries, which were upheld by the CIT(A)/NFAC.
Held
The Tribunal noted that the assessee failed to provide explanations for the source of cash deposits and credit entries. While the AO's addition for cash deposits was largely upheld, the addition for credit entries was restricted. The Tribunal granted a partial relief considering the assessee's socio-economic status.
Key Issues
Whether the assessee has adequately explained the source of cash deposits and credit entries in her bank account, and whether the additions made by the AO are justified.
Sections Cited
147, 144, 69A, 143(3)
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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. Satbeer Singh Godara
Asstt. Year : 2012-13 Pawan Devi, Vs Income Tax Officer, W/o Sh. Vinod Kumar, Ward-2(4), R/o R-0004, Homes 121, Sector- Noida 121, Noida, U.P.-201301 (APPELLANT) (RESPONDENT) PAN No. AMDPD3916F Assessee by: None Revenue by : Ms. Indu Bala Saini, Sr. DR Date of Hearing: 23.06.2025 Date of Pronouncement: 23.06.2025 ORDER This assessee’s appeal for Assessment Year 2012-13, arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2024-25/1070658628(1) dated 26.11.2024, in proceedings u/s 147 r.w.s. 144 of the Income Tax Act, 1961 (in short “the Act”).
Case called twice. None appears at the assessee’s behest. She had also not to be in appearance on all the earlier occasions as well. The assessee is accordingly proceeded ex- parte.
Learned departmental representative vehemently argues that the CIT(A)/NFAC herein has rightly affirmed the Assessing Officer’s action inter alia making section 69A addition of Rs.19,63,000/- representing cash deposits in bank account and Pawan Devi Rs.9,51,906/- in the nature of cash credits entries; respectively, in assessment order dated 06.12.2019 by the Assessing Officer. The tribunal’s attention is further invited to the learned CIT(A)/NFAC’s lower appellate discussion to this effect reading as under: “5.5 The above remand report furnished by the jurisdictional assessing officer was forwarded to the appellant for offering his counter comments. However the appellant failed to furnish any comments. 5.6 I have carefully read the main comments of the jurisdictional assessing Officer in the remand report. It is worthwhile to mention here that on the one side the AO has completely assessed the source of the cash deposited of Rs 19,63,000/- as the illegitimate one. However, one the other hand, the appellant harped on the same tune that the funds were duly received from his brother for her daughter marriage function and also from her past saving. Further, in respect of the source of the credit entries nothing was said by the Jurisdictional assessing officer in his remand report. 5.7 Now in order to adjudicate the issue all the facts of the case, findings of the AO during the assessment as well as remand proceedings and the submissions made by the appellant has been taken due cognizance off. Upon thorough review of the materials presented in this appeal, I am of the considerate view that assessing officer has systematically analysed and effectively countered the appellant's explanations in respect of the source of the cash deposited. The appellant claimed that funds deposited in the bank account were received from her brother for her daughter's marriage, which was subsequently cancelled. However, this claim lacks substance, as the deposits and withdrawals spanned over five months, suggesting that the transactions were not merely related to a one-time marriage expense. Such prolonged redeposit and withdrawal activity is inconsistent with the appellant's explanation, weakening the credibility of this claim. Further, the appellant's assertion that she held a substantial cash saving of Rs. 3,50,000/- over the years and suddenly decided to deposit it in the bank just before the marriage is implausible. It is unreasonable to believe that she Would keep a large cash amount unused for an extended period only to deposit it temporarily in the bank and later Pawan Devi withdraw it. If her intention was to access the funds for the marriage, it is unclear why she deposited them in the bank only to withdraw them soon after. Such behaviour does not align with the natural course of action one would expect if the funds were genuinely set aside for a specific purpose like a family event. This explanation, therefore, appears to lack credibility and is not convincing. In view of the facts above the action taken by the AO appears to be in order and accordingly the addition made by the AO of Rs.19,63,000/- is hereby upheld. 5.8 Regarding the issue of credit entries of Rs.21,67,000/- in the account, neither the assessing officer in the remand report nor the appellant provided specific comments on this matter. So, in order to adjudicate this issue I have carefully examined the bank statement of the appellant's bank account. On reviewing the bank statements, it was noted that, apart from cash deposits entries of Rs.19,63,000/-, there were only other credit entries amounting to Rs 9,51,906/- only and not the Rs.21,67,000/- as alleged by the AO during the assessment proceedings. It is evident from the bank statement that few big credit entries ranging from Rs. 2,00,000/- to Rs. 8,85,000/- were not realized due to signature mismatch and insufficient balance. Therefore, the addition concerning credit entries from Rs.21,67,000/- is restricted to Rs. 9,51,906/-, based on the actual entries observed in the statements. Thus, ground raised
by the appellant in this regard is hereby partly allowed.
6. In the result the appeal is partly Allowed.”
4. I have given my thoughtful consideration to the assessee’s pleadings all along and the Revenue’s foregoing contentions. The fact remains that apart from making some oral assertions right from the scrutiny till remand proceedings before the CIT(A)/NFAC, the assessee has not been explained the source of the impugned cash deposits and credits; as the case may be, all along.
Pawan Devi 5. This is indeed coupled with the fact that keeping in mind the assessee socio-economic status, it could be safely presumed that possibility of her family’s accumulated cash as well as “stridhan” in her hands could not be altogether ruled out. That being the case, this tribunal deems it appropriate in the larger interest of justice to grant a relief of Rs.8,00,000/- to the assessee and the balance addition of Rs.11,63,000/- as well as Rs.9,51,906/- (supra), stand confirmed in very terms. Ordered accordingly.