RITA RANI,B-III/, SANTA WALI GALI, BARNALA vs. ITO, BARNALA

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ITA 1335/CHANDI/2025Status: DisposedITAT Chandigarh14 May 2026AY 2023-243 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal found the assessee's explanation of the business activity plausible and accepted the income offered on a presumptive basis. The addition for bank deposits was also deleted due to a marginal increase in the bank balance.

What were the facts?

The assessee made cash payments towards a credit card used for paying utility bills on behalf of customers. The Assessing Officer added Rs. 11 Lacs for unsubstantiated cash payments and Rs. 1.48 Lacs for unexplained bank deposits, along with a short addition for bank interest.

What were the issues?

Whether cash payments towards credit card dues for customer utility bills and unexplained bank deposits are additions to income.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144B,Section 44AD

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, CHANDIGARH

Before: HON’BLE SHRI LALIET KUMAR, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, CHANDIGARH HYBRID HEARING BEFORE HON’BLE SHRI LALIET KUMAR, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकर अपील सं. / ITA No.1335/CHANDI/2025 (िनधा�रण वष� / Assessment Year: 2023-24) Ms. Rita Rani ITO बनाम/ Vs. B-III, Santa Wali Gali, Barnala Barnala Punjab - 148101 �ायीलेखासं./जीआइआरसं./PAN/GIR No. EZAPR-8822-Q (अपीलाथ�/Appellant) : (��थ� / Respondent) अपीलाथ�कीओरसे/ Appellant by : Sh. Prince Goyal (Advocate) – Ld. AR ��थ�कीओरसे/Respondent by : Dr. Ranjit Kaur (Addl. CIT) – Ld. Sr. DR (Virtual) सुनवाईकीतारीख/Date of Hearing : 12-05-2026 घोषणाकीतारीख /Date of Pronouncement 14-05-2026 : आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Years (AY) 2023- 24 arises out of an order of learned Commissioner of Income Tax (Appeals), NFAC [CIT(A)] dated 01-09-2025 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s 143(3) r.w.s. 144B of the Act on 20-01-2025. The sole grievance of the assessee is confirmation of addition of Rs.13.02 Lacs. Having heard rival submissions, the appeal is disposed-off as under.

2.

The assessee filed return of income on 28-07-2023 declaring income of Rs.4.46 Lacs. During scrutiny proceedings, Ld. AO noted that the assessee made cash payments towards credit card issued by Indusind Bank. It was stated that the credit card was primarily used for paying utility bills on behalf of customers. The credit card payments were summarized by the assessee which has been extracted in the assessment order. It was noted that the assessee made cash payment of Rs.11 Lacs towards credit card but the asssessee could not substantiate her claim. Therefore, the amount of Rs.11 Lacs was added to the income of the assessee. The assessee made cash deposit of Rs.1.48 Lacs in her bank statement which was also added for want of sources. The bank interest income was reflected short for Rs.54,195/- which was separately added as income from other sources. The Ld. CIT(A) endorsed the assessment against which the assessee is in further appeal before us. 3. From submissions made before us, it emerges that the assessee family is engaged in small commission agency activity of making online payment of utility bills on behalf of local residents and small traders. The collections made from the customers are deposited towards credit card dues and the assessee makes payment on behalf of such customers. The assessee earns nominal commission of Rs.10/- to Rs.15/- per transactions which has been offered to tax on presumptive basis u/s 44AD. We find that the explanation of the assessee is plausible one. Considering the nature of business activities, the assessee may not be in a position to file sufficient documentary

evidences to substantiate this claim. Nevertheless, the accrued income has been offered on presumptive basis u/s 44AD and the same is to be accepted. So far as the addition of Rs.1.48 Lacs is concerned, it could be seen that opening bank balance is for Rs.10,48,205/- whereas closing balance is Rs.11,31,447/- and there is marginal increase in bank balance for Rs.83,242/-. The Ld. AO has picked up an isolated entry and made the addition. Therefore, this addition also could not be sustained. We order so. The addition of interest income does not warrant any interference on our part. The impugned addition of Rs.11 Lacs and Rs.1.48 Lacs stand deleted. 4. The appeal stand partly allowed. Order pronounced on 14th May, 2026.

-Sd- -Sd- (LALIET KUMAR) (MANOJ KUMAR AGGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER AS Dated: 14-05-2026 आदेश की �ितिलिप अ�ेिषत /Copy of the Order forwarded to : 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकरआयु�/CIT 4. िवभागीय�ितिनिध/DR 5. गाड�फाईल/GF

ASSISTANT REGISTRAR ITAT CHANDIGARH

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