VIKASH KUMAR ,MUZAFFARPUR vs. ITO WARD-1(1), MUZAFFARPUR

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ITA 37/PAT/2026Status: DisposedITAT Patna27 April 2026AY 2017-185 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal noted that the assessee had been given ample opportunities but failed to explain the source of the cash deposits. However, in the interest of justice, the case was remitted back to the AO to provide one more chance to the assessee to substantiate the source with cogent documents.

What were the facts?

The assessee deposited a significant amount of cash in their bank account during the demonetisation period. The Assessing Officer (AO) added this amount to the total income for lack of satisfactory evidence regarding its source. The Commissioner of Income Tax (Appeals) dismissed the assessee's appeal.

What were the issues?

Whether the cash deposits made during demonetisation were adequately explained by the assessee, and if not, whether the addition by the AO was justified.

Which sections of the Income-tax Act were involved?

Section 69A,Section 143(2),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PATNA BENCH, PATNA

Hearing: 15.04.2026Pronounced: 27.04.2026

IN THE INCOME TAX APPELLATE TRIBUNAL PATNA BENCH, PATNA (VIRTUAL HEARING AT KOLKATA) SHRI GEORGE MATHAN, JUDICIAL MEMBER SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER

ITA No. 37/PAT/2026 Assessment Year : 2017-2018

Vikash Kumar, Vs. Income Tax Officer, S/o Raj Mangal Sharma, Ward, Kendrapada, Haripur Krishna, PO- Siho, At- Income Tax Office, PS – Sakra, Muzaffarpur, Kendrapara Ward - (Bihar)- 843119 754250 [PAN: DTMPK7671F]

APPELLANT RESPONDENT

Assessee by : None Revenue by : Sh. Manab Adak, JCIT

Date of hearing : 15.04.2026 Date of Pronouncement : 27.04.2026

O R D E R PER LAXMI PRASAD SAHU, ACCOUNTANT MEMBER

This is an appeal filed by the assessee against the order passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) by the Ld. Commissioner of Income Tax, (Appeals), National Faceless Appeal Centre [hereinafter referred to as “the Ld. CIT(A)], dated 04.11.2025, DIN

2 ITA No. 37/PAT/2026 Viaksh Kumar & Order No. Appeal No. ITBA/NFAC/S/250/2025-26/1082276935(1) challenging the order of Ld. CIT(A).

2.

None present on behalf of the assessee. Case was heard qua the Ld. DR.

3.

Briefly stated the facts of the case are that the assessee filed return of income on 01.08.2017 showing total income of the assessee at Rs. 3,21,730/-. The case was selected for scrutiny under CASS, therefore, notice u/s 143(2) of the Act dated 24.09.2018 was issued which was duly served to the assessee. Subsequently, other statutory notices were issued to the assessee. It was observed that during the demonetisation period, the assessee deposited cash in bank account number 133001504732 maintained in Central Bank as under:

SI No. Date of Deposit Amount (in Rs.) 1 10/11/2016 1,10,000/- 2 11/11/2016 9,84,000/- 3 12/11/2016 9,50,000/- 4. 13.11.2016 6,25,000/- Total 26,69,000/- 4. During the course of assessment proceedings, the assessee did not produce any satisfactory evidence in support of cash deposits in his bank account. The AO observed from the submission made that the sale deed produced by the assessee have no serial number so it was not accepted as genuine at Rs. 8 lacs shown from the previous year saving but it was not reflected in the ITR filed by the assessee. Accordingly, for want of

3 ITA No. 37/PAT/2026 Viaksh Kumar proper explanation for the source of cash of deposit the AO invoked section 69A of the Act and added into total income of the assessee.

5.

Aggrieved from the above order, the assessee filed appeal before the Ld. CIT(A). During the course of appellate proceedings, the assessee field written submissions which was considered but it was also not found in order, for want of explanation regarding the source of cash deposit with credible evidence, therefore, the Ld. CIT(A) dismissed the appeal of the assessee.

6.

Aggrieved from the above order, the assessee filed appeal before the ITAT.

7.

The Ld. DR relied on the order of lower authorities and submitted that the assessee was given ample opportunities to explain the source of cash deposits during demonetisation period. However, the assessee failed to substantiate the cash deposits during demonetisation period regarding the opening balance shown, there was no information in the income tax return filed by the assessee from the last year , therefore, Rs. 8 lacs shown as opening balance was also not accepted. Regarding sales of agriculture produce and agricultural equipment were also not submitted at any stage with documentary evidence. Therefore, the source was remained unexplained.

8.

Considering the submissions of the Ld. DR and written submissions made during the appellate proceedings and order of

4 ITA No. 37/PAT/2026 Viaksh Kumar authorities below. We noted that the assessee is engaged in retail sales of agricultural produce and agricultural equipment, the case has been selected for scrutiny. During the assessment proceedings, the ample opportunity was granted to the assessee, the assessee could not explain source of the cash deposits during demonetisation period (noted supra) in the bank account (noted supra) before the Ld. CIT(A). The assessee filed only written submissions. Considering the facts and in the interests of justice, we are giving one more chance to the assessee to explain the source of cash deposits in bank account during demonetisation period. Therefore, the case is remitted back to the AO for fresh decision as per law after giving a reasonable opportunity of being heard to the assessee and assessee directed to substantiate the source cash deposits with cogent documents and not seek unnecessary adjournments for early disposal of the case. In case of failure, no second leniency shall be granted to the assessee.

9.

In the result, appeal of the assessee is partly allowed for statistical purposes.

Order pronounced on 27.04.2026. Sd/- Sd/- (George Mathan) (Laxmi Prasad Sahu) Judicial Member Accountant Member Dated: 27.04.2026 AK, Sr. P.S.

5 ITA No. 37/PAT/2026 Viaksh Kumar Copy of the order forwarded to: 1. Appellant 2. Respondent 3. Pr. CIT 4. CIT(A) 5. CIT(DR)

//True copy// By order

Assistant Registrar, Kolkata Benches

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