BHIKHU RAJSHI KARAVADARA,PORBANDAR vs. INCOME TAX OFFICER WARD-2(4), PORBANDAR

ITA 1097/RJT/2026Status: DisposedITAT Rajkot12 October 2026AY 2012-135 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal condoned the delay of 430 days in filing the appeal, finding mitigating circumstances in the assessee's affidavit and exercising discretion in favour of the assessee. Regarding the addition, the Tribunal acknowledged that the assessee is an agriculturist and had submitted evidence of agricultural income. The AO admitted regular withdrawals and deposits of cash from the bank for agricultural purposes out of agricultural income. However, the Tribunal noted that the AO did not conduct sufficient inquiry before rejecting the assessee's submissions and evidence, merely brushing them aside. While finding merit in the assessee's contention that the evidence could not be summarily rejected, the Tribunal also observed that some documents were self-serving and not entirely reliable. To protect the revenue's interest and considering the smallness of the amount, the Tribunal directed an ad-hoc estimated addition. The Tribunal held that the ends of justice would be met by adopting a net profit rate of 10% on the total addition of Rs. 11,65,540/-, amounting to Rs. 1,16,554/-. This estimated addition would account for inconsistencies in the evidence. The AO was directed to make this addition, not under Section 115BBE. The Tribunal clarified that this adjudication would not serve as a precedent due to the small amount involved.

What were the facts?

The assessee, Bhikhu Rajshi Karavadara, an individual and agriculturist, filed an appeal before the Income Tax Appellate Tribunal (ITAT), Rajkot Bench, for Assessment Year (AY) 2012-13. The appeal challenged the order of the National Faceless Appeal Centre (NFAC), Delhi, dated 16.04.2025, which upheld an assessment order passed by the Assessing Officer (AO) under Section 147 of the Income-tax Act, 1961, dated 06.12.2019. The assessee's appeal was filed belatedly by 430 days, for which a condonation petition was filed. The AO had made an addition of Rs. 11,50,000/- on account of peak credit of cash deposited in the bank, treating it as unexplained money under Section 69A, and Rs. 15,540/- as interest income from the bank, totaling Rs. 11,65,540/-. The assessee contended that these deposits were out of agricultural income.

What were the issues?

1. Whether the Tribunal has the power to condone the delay of 430 days in filing the appeal, considering the reasons provided by the assessee? Assessee's contention: The delay was caused due to a mistake by the assessee's advocate, and a benign view should be taken for condonation. Revenue's contention: The prayer for condonation of delay should be opposed, and the appeal may be dismissed on account of the delay. 2. Whether the addition of Rs. 11,50,000/- (peak credit) and Rs. 15,540/- (bank interest), totaling Rs. 11,65,540/-, made by the Assessing Officer and confirmed by the CIT(A) is justified, primarily on account of cash deposits in the bank account out of agricultural income? Assessee's contention: The AO admitted that the assessee is an agriculturist and had shown agricultural income. The AO also admitted that the assessee regularly withdrew and deposited cash from the bank account out of agricultural income. Necessary evidence pertaining to agricultural income and land holding was submitted, and therefore, the addition should be deleted. Revenue's contention: The Revenue reiterated the stand taken by the Assessing Officer.

Which sections of the Income-tax Act were involved?

Section 69A,Section 147,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC”

Before: Dr. Arjun Lal Saini

For Appellant: Shri Sagar Shah, Ld. AR
For Respondent: Shri Ganesh Iyer, Ld. Sr. DR
Hearing: 01/10/2026

Per, Dr. Arjun Lal Saini, AM: Captioned appeal filed by the assessee, pertaining to assessment year (AY) 2012-13, is directed against the order under section 250 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by the National Faceless Appeal Centre (NAC) Delhi/Commissioner of Income-tax (Appeals) [in short ‘NFAC/Ld.CIT(A)’], dated 16.04.2025, which in turn arises out of an assessment order passed by the Assessing Officer u/s 147 of the Act, dated 06.12.2019. 2. When the matter was called for hearing, the learned Counsel for the

The order continues below.

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