GEETHA RAJINI,CHENNAI vs. ITO, INTL TAXN. WARD 1(1), CHENNAI, CHENNAI

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ITA 748/CHNY/2026Status: DisposedITAT Chennai17 August 2026AY 2017-184 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found that the Rs. 20 Lacs deposited in the assessee's joint bank account with her husband originated from gifts received by the husband from his mother, which were documented in the mother's bank statements. Therefore, the addition was deleted.

What were the facts?

The Assessing Officer reopened the assessment of the assessee, a non-resident, and proposed an addition of Rs. 20 Lacs on account of unexplained money. The Dispute Resolution Panel confirmed the draft assessment order. The assessee appealed this order.

What were the issues?

Whether the addition of Rs. 20 Lacs as unexplained investment was justified, considering the source of funds was demonstrated through bank statements of the husband's mother.

Which sections of the Income-tax Act were involved?

Section 147,Section 144C,Section 69,Section 69A,Section 148,Section 149(1)(b)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI

Before: HONOURABLE SHRI S.S. VISWANETHRA RAVI & SHRI GAGAN GOYAL

Hearing: 11.08.2026Pronounced: 17.08.2026

आयकर अपीलीय अधिकरण, ‘ए’ न्यायपीठ, चेन्नई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH: CHENNAI माननीय श्री यस. यस. विश्वनेत्र रवि, न्याययक सदस्य एवं श्री गगन गोयल लेखा सदस्य के समक्ष BEFORE HONOURABLE SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER AND SHRI GAGAN GOYAL, ACCOUNTANT MEMBER आयकर अपील सं./ITA No. 748/Chny/2026 यनिाारण वर्ा /Assessment Years: 2017-18

Geetha Rajini, v. Income Tax Officer, No.27A, Alamelumangapuram, 2nd Cross, International Taxation Ward-1(1), Venkatraman Street, Madipakkam Post, Chennai. Chennai-600 091. [PAN: AFCPG3204M] (अपीलार्थी/Appellant) (प्रत्यर्थी/Respondent) अपीलार्थी की ओर से/ Assessee by : Mr. B. Ramakrishnan, F.C.A, Ld. AR. प्रत्यर्थी की ओर से /Revenue by : Ms. Anshu Sharawat, Addl. CIT, Ld. DR सुनवाईकीतारीख/Date of Hearing : 11.08.2026 घोषणाकीतारीख /Date of Pronouncement : 17.08.2026 आदेश / O R D E R PER GAGAN GOYAL, AM: This appeal is filed by the assessee against the order bearing DIN & Order No.ITBA / COM / F / 17/ 2025-26 / 1085009859(1) dated 21.01.2026 of the Assessing Officer, for the assessment year 2017-18 passed in compliance to directions of DRP order dated 12.12.2025.

GROUDS OF APPEAL 1. For that the order of the Learned Assessing Officer ("Learned AO") dated 21.01.2026 passed u/s. 147 r.w.s.144C(13) of the Income Tax Act, 1961 ("the Act") pursuant to the directions of the Dispute Resolution Panel ("DRP") dated 12.12.2025 is erroneous and bad in law as it is passed on: a. inaccurate appreciation of facts:

ITA No.748/Chny/2026 (2017-18) Geetha Rajini b. references/conclusions are contrary to the documentation/materials on record; c. non-consideration of the documentation/materials on record and d. in any case passed in violation of natural justice. 2. For that the reopening of the assessment u/s 147 of the Act is invalid and bad in law. 3. For that that the initiation of proceedings u/s 147 for AY 2017-18 by invoking section 149(1) (b) of the Act is without jurisdiction and bad in law, as the year falls beyond three years and the alleged escaped income is only Rs. 20, 00,000/-, which is below the statutory threshold of Rs. 50, 00,000/- required for invoking the extended limitation, rendering the reopening and consequent Assessment Order of the Act unsustainable. 4. For that the reassessment order passed u/s 147 of the Act is null and void, having been framed in blatant violation of the mandatory procedure laid down under the 'Faceless Jurisdiction of Income-tax Authorities Scheme, 2022' and the 'e-Assessment of Income Escaping Assessment Scheme, 2022', in as much as the reassessment was initiated and carried out by the Jurisdictional Assessing Officer in a non-faceless manner, thereby rendering the entire proceedings without jurisdiction and bad in law. 5. For that the Learned AO erred in adding Rs. 20, 00,000/- as unexplained investments u/s 69 of the Act. (Tax effect-Rs.15, 45,000/-) 6. For that the Hon'ble DRP, having categorically accepted that an addition u/s 69A of the Act was not sustainable since the alleged unexplained cash was never deposited in the appellant's bank account, erred in law and on facts in directing the Learned Assessing Officer to make an addition of Rs. 20, 00,000/- u/s 69 of the Act. 7. For that the Hon'ble DRP erred in directing the Learned Assessing Officer to invoke section 69 of the Act without affording the appellant a fair and effective opportunity to rebut the proposed invocation of section 69 and to explain the nature and source of the alleged investment, thereby violating the principles of natural justice and the mandatory requirement of providing an opportunity of being heard before making an addition u/s 69 of the Act. For these grounds and such other grounds that may be adduced before or during the hearing of the appeal, it is prayed that the Hon'ble Tribunal may be pleased to delete the additions and/or provide such other relief as the Hon'ble Tribunal deems fit.

2.

The brief facts of the case are that the assessee is a non-resident and amongst the non-filers of the return. As per Risk Management Strategy (RMS) formulated by the Board was available namely, (i) Purchase of Time Deposit – Rs. 48.50 Lacs, (ii) Sale of Immovable Property - Rs. 32.45 Lacs and (iii) Cash Payments for Goods and Services amounting to Rs. 13.61 Lacs. Based on the above, a notice u/s. 148 of the Act was issued vide dated: 15.02.2024, but no return was filed by the assessee in response to the same. Ultimately, a draft assessment

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ITA No.748/Chny/2026 (2017-18) Geetha Rajini order u/s. 144C (1) of the Act was passed with a proposed addition of Rs. 20 Lacs on account of unexplained money deposit u/s. 69A of the Act vide order dated: 28.03.2025. The assessee filed objections with the Dispute Resolution Panel (DRP) against the draft assessment order on 24.04.2025 and DRP confirmed the draft assessment order vide order dated: 12.12.2025 by issuing directions u/s. 144C (5) of the Act.

3.

Final order was passed by the AO in compliance to the directions issued by the DRP u/s. 144C (5) of the Act vide order dated: 21.01.2026 u/s. 147 r.w.s. 144C (13) of the Act. The assessee being aggrieved with the order passed u/s. 147 r.w.s. 144C (13) of the Act preferred the present appeal before us. We have gone through the various order of the authorities passed u/s. 144C (1), 144C (5) and 147 r.w.s. 144C (13) of the Act as mentioned (supra) and submissions of the assessee alongwith grounds taken before us. It is observed that the case of the assessee was re-opened for the reasons as mentioned in para 2 above (supra), but ultimately, addition was made on account of Rs. 20 Lacs only on account of unexplained money u/s. 69A of the Act, meaning thereby rest of the issues were duly explained by the assessee and accepted by the Revenue.

4.

The issue for our consideration is limited to Rs. 20 Lacs addition made u/s. 69A of the Act. Ground Nos. 1 to 4, i.e. technical and legal grounds raised by the assessee, will be discussed in the later part of our order, if required, i.e. in case Ground Nos. 5 to 7 on merits do not succeed. The assessee received a sum of Rs. 15 Lacs and 5 Lacs by way of inward credits on 24.08.2016, which were subsequently used for the investment in FDs. It is brought to our notice that the assessee was a joint account holder in the bank account under consideration and primary account holder was her husband Mr. Terence Babu Bosco (PAN No. AIUPB 9990L) and her spouse Mr. Terence Babu Bosco received Rs. 15 Lacs and Rs. 5 Lacs from his mother in the form of a personal family gift for the purposes of property purchase and jewel for her grand-daughter, i.e. daughter of her spouse.

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ITA No.748/Chny/2026 (2017-18) Geetha Rajini 5. We have gone through the bank statements of the mother of Mr. Terence Babu Bosco in Canara Bank and Indian Bank vide page nos. 267 to 282 of the paper book and observed that the amount of Rs. 5 Lacs and 15 Lacs are duly reflected in her bank Statements vide dated: 25.08.2016. In view of this fact, we do not have any doubt about the source of deposits in the assessee’s account as joint account holder with her husband. It is astonishing for us that such a glaring fact abruptly ignored by the AO as well as the body like DRP. We find that the assessee is able to demonstrate the source of deposits/FDs in her bank account jointly with her husband.

6.

In view of the above observations and fact finding, the AO is directed to delete the addition made in the case of the assessee amounting to Rs. 20 Lacs. Ground Nos. 5 to 7 raised by the assessee are allowed in above terms and Ground Nos. 1 to 4 left open as the appeal of the assessee is allowed on its merits.

7.

In the result, the appeal of the assessee is allowed in above terms. Order pronounced on the 17th day of August, 2026, in Chennai.

Sd/- Sd/- (यस. यस. विश्वनेत्र रवि) (गगन गोयल) (S.S. VISWANETHRA RAVI) (GAGAN GOYAL) न्याययक सदस्य/JUDICIAL MEMBER लेखा सदस्य/ACCOUNTANT MEMBER चेन्नई/Chennai, ददनाांक/Dated: 17th August, 2026. KB आदेश की प्रयतललपप अग्रेपषत/Copy to: 1. अपीलार्थी/Appellant 2. प्रत्यर्थी/Respondent 3. आयकर आयुक्त/CIT, Chennai /Madurai/Coimbatore/Salem 4. पवभागीय प्रयतयनधि/DR Digitally signed K BABU by K BABU 5. गार्ड फाईल/GF Date: 2026.08.24 14:38:45 +05'30'

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