MANOJ KUMAR JAIN,NEW DELHI vs. ACIT,CENTRAL CIRCLE-14, NEW DELHI

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ITA 3172/DEL/2024Status: DisposedITAT Delhi16 May 2025AY 2019-205 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the assessee's claim that the cash deposits of INR 2,43,330/- were received from his father could not be accepted. The Tribunal noted that the father's only source of cash was a monthly contribution of INR 12,000/- from the assessee and his two brothers, which was used for their day-to-day expenses. The Tribunal found it unacceptable that the father could have accumulated INR 3,67,400/- after meeting these expenses, especially when cash was given to the assessee almost on a monthly basis, exceeding the father's monthly receipts. Therefore, the Tribunal found no infirmity in the Ld.CIT(A)'s order confirming the addition of INR 2,43,330/- as unexplained cash deposits under section 69 of the Act. Regarding the interest under section 234B, the judgment does not explicitly state a finding or reasoning, but the dismissal of the appeal implies it was upheld. The Tribunal did not expressly leave any issue undecided.

What were the facts?

The assessee, Manoj Kumar Jain, is an individual whose case was centralized with the ACIT, Central Circle-14, New Delhi. During an inspection by the Air Intelligence Unit (AIU) in Chennai on September 13, 2018, the assessee was found in possession of INR 15 Lakhs in cash. The assessee filed a return of income for assessment year 2019-20 declaring INR 3,45,110/-. The Assessing Officer (AO) completed the assessment under section 143(3) on May 31, 2021, determining a total income of INR 29,99,100/-. This involved additions of INR 15 Lakhs for undisclosed cash under section 69A r.w.s 115BBE, unexplained bank deposits under section 69A, disallowance of deduction under section VIA of INR 66,379/-, and denial of HRA exemption under section 10(13A) of INR 1,94,000/-. The Ld.CIT(A) granted substantial relief, upholding an addition of INR 2,43,330/- on account of bank deposits out of a total addition of INR 9,14,985/- made by the AO, and deleting the remaining additions/disallowances. The assessee is aggrieved by this order and has filed an appeal before the Tribunal.

What were the issues?

1. Whether the authorities below erred in confirming the addition of INR 2,43,330/- on account of unexplained cash deposits into bank accounts under section 69 r.w.s 115BBE of the Act. The assessee contended that the cash deposits were out of INR 3,67,400/- received from his father, Shri Mohan Lal Jain, who had savings from monthly contributions from the assessee and his brothers for his day-to-day expenses. The assessee argued that his father, being old and having paid taxes for years, could have such cash. The revenue, through the Ld.CIT DR, supported the order of the lower authorities, noting that the Ld.CIT(A) had already allowed relief on deposits through banking channels and credited INR 72,240/- representing the father's declared income out of the total cash receipts. The revenue argued that the Ld.CIT(A)'s order was reasonable and should be confirmed. 2. Whether the authorities below erred in charging interest under section 234B of the Act. The assessee argued that this action was wrong, illegal, and unjustified. The judgment does not record specific arguments from the revenue on this ground.

Which sections of the Income-tax Act were involved?

Section 69A,Section 115BBE,Section 69,Section 10(13A),Section 143(3),Section 250,Section 143(2),Section 142(1),Section 234B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI “E” BENCH: NEW DELHI

Before: SHRI MAHAVIR SINGH & SHRI MANISH AGARWAL

For Appellant: Shri Rajesh Malhotra, CA, Ms. Shivangi Kumar, Adv. &, Ms. Chavi Malhotra, Adv
For Respondent: Shri Sujit Kumar, CIT DR
Hearing: 28.04.2025Pronounced: 16.05.2025
1.

The present appeal has been filed by the assessee seeking to assail the First Appellate order dated 09.05.2024 of Ld. Commissioner of Income Tax (A)- 28, New Delhi [“Ld.CIT(A)”] in Appeal No.26/10597/2018-19 passed u/s 250 of the Income Tax Act, 1961 [“the Act”] arising from the assessment order dated 31.05.2021 passed u/s 143(3) of the Act pertaining to assessment year 2019- 20.

2.

Brief facts of the case are that the assessee is an individual and was inspected by Air Intelligence Unit (AIU) of the Investigation Wing in Chennai when he was travelling from New Delhi to Chennai by Jet Airways on 13.09.2018. During the course of search by AIU unit, the assessee was found in possession of cash of INR 15 Lakhs. Thereafter, the case of the assessee was centralized with the ACIT, Central Circle-14, New Delhi. The assessee has Page | 1 filed the return of income in year under appeal on 31.08.2019 declaring total income of INR 3,45,110/-. Notice u/s 143(2) of the Act was issued on 18.01.2021 and thereafter, notices under section 142(1) were issued from time to time wherein certain details and explanations were sought from the assessee which includes the source of cash of INR 15 Lakhs found from his possession. The assessee made compliances to the said notices and after considering the submissions, the assessment was completed vide order dated 31.05.2021 passed under section 143(3) of the Act at a total income of INR 29,99,100/- by making following additions/disallowances:- (i) Addition of INR 15 Lakhs towards undisclosed cash found under section 69A r.w.s. 115BBE of the Act; (ii) Unexplained deposits in bank account under section 69A of the Act; (iii) Disallowance of deduction claimed under section VIA of INR 66,379/-; and (iv) Denial of exemption under section 10(13A) for HRA of INR 1,94,000/-.

3.

Against this order, the assessee preferred appeal before the Ld.CIT(A) who vide impugned order dated 09.05.024 allowed substantial relief to the assessee by upholding the addition of INR 2,43,330/- on account of bank deposits out of total addition of INR 9,14,985/- made by the AO and remaining additions/disallowances were deleted.

4.

Aggrieved by the said order, the assessee is in appeal before the Tribunal.

5.

The assessee has taken following grounds of appeal:- 1. “On the facts and in the circumstances of the case and in law, the authorities have erred in confirming the addition of Rs.2,43,330/- on account of unexplained into bank accounts under section 69 r.w.s 115BBE of the Act The action of the authorities below is wrong, illegal, misconceived, unjustified and bad at law therefore it should be quashed.

2. On the facts and in the circumstances of the case and in law, the authorities below have erred in charging interest u/s 234B. The action of the authorities is wrong, illegal, misconceived, unjustified and bad at law therefore it should be quashed.

3. The appellant craves the right to add, submit, alter or withdraw any or all grounds of appeal before or on the date of hearing.

6. Before us, the Ld.AR for the assessee reiterated the arguments put forth before the lower authorities with respect to the sources of the cash deposits made in the bank account. It is further submitted by Ld.AR for the assessee that the total cash of INR 3,67,400/- deposited on various dates was out of the cash received from his father, Shri Mohan Lal Jain and in support of the same, an affidavit is also filed which is available at Pages 31 to 33 of the Paper Book. He further submitted that the father of the assessee was old and having assessed to tax for past so many years, therefore, availability of the cash in his hands cannot be doubted. He further submits that the assessee and his brothers were giving cash to his father on monthly basis for his day to day expenses out of which the father of the assessee has saved certain amount and given to the assessee. He thus, prayed for the deletion of the additions so upheld by the Ld.CIT(A).

7. On the other hand, the Ld.CIT DR for the Revenue vehemently supported the order of the lower authorities and submitted that the Ld.CIT(A) has already allowed the relief of the deposits made through banking channels and further allowed credit of INR 72,240/-, i.e. the income declared by the father of the assessee out of total cash receipts of INR 3,67,400/- from him thus the order of the Ld.CIT(A) is very reasonable and he requested for confirmation of the same.

8.

We have heard the rival submissions and perused the material available on record. The sole issue before us is with regard to the receipt of cash of INR 2,43,330/- from the father of the assessee on various dated which was deposited in the bank account of the assessee. It is seen that the cash was received in different sums such as INR 8,000/-; 5,000/-; 49,500/-; 49,000/-; 48,900/-; 20,000/-; 15,000/-; 20,000/-; 20,000/-; 20,000/-, 20,000/- and so on and in all on total 16 occasions, cash was received in different sum which were deposited on the same day or on subsequent date by the assessee.

9.

From the perusal of the affidavit filed by the father of the assessee, it is seen that only source of cash with the father was monthly contribution of INR 12,000/- given by the assessee and his other two brothers. Out of the said cash, parents of the assessee meet out their day to day expenses thus it cannot be acceptable that the father of the assessee was having cash of INR 3,67,400/- available with him after meeting out their day to day needs. Further, it is seen that almost on monthly basis, cash was given to the assessee, when his father was receiving only INR 12,000/- monthly from his sons. It is not clear as to how and from where he is able to give the assessee more cash that what he is receiving from his sons. Thus, the claim of the assessee that the cash was received from his father, was deposited in the bank account cannot be accepted.

10.

Since the immediate source of cash was claimed as the receipts from his father for which, we have already observed that father was not having any source to earn this cash. Therefore, we find no infirmity in the order of the Ld.CIT(A) in confirming the addition of INR 2,43,330/- in the hands of the assessee on account of cash deposits made in the bank account as unexplained under s. 69 of the Act.

11.

In the result, the appeal of the assessee is dismissed.

Order pronounced in the open Court on 16.05.2025.

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