CHANDRASHEKHAR MADHUSUDAN RANE,MUMBAI vs. ITO, WARD-26(1)(6), MUMBAI, MUMBAI

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ITA 806/MUM/2022Status: DisposedITAT Mumbai28 November 2022AY 2017-187 pages

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

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the bank accounts belonged to Sahara India and not the assessee. Therefore, the addition of cash deposits to the assessee's income was incorrect.

What were the facts?

The assessee, an employee, had cash deposits of Rs. 17,11,000/- made in bank accounts where he was only a signatory for his employer, Sahara India. The Assessing Officer treated these deposits as unexplained assets in the assessee's hands.

What were the issues?

Whether cash deposits made in an employer's bank account, where the assessee is only a signatory, can be added to the assessee's income as unexplained assets.

Which sections of the Income-tax Act were involved?

Section 69A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI

For Appellant: Shri. Dharan Gandhi, Ms. Neeta Jeph
For Respondent: Ms. Neeta Jeph

स्थायीलेखासं./जीआइआरसं./ PAN No. ACXPR5558F (अपीलाथी/Appellant) (प्रत्यथी / Respondent) : अपीलाथीकीओरसे/ Appellant by : Shri. Dharan Gandhi प्रत्यथीकीओरसे/Respondent by : Ms. Neeta Jeph सुनवाईकीतारीख/ : 30.08.2022 Date of Hearing घोषणाकीतारीख / : 28 .11.2022 Date of Pronouncement आदेश / O R D E R

Per Amit Shukla, Judicial Member:

1.

The aforesaid appeal has been filed by the assessee against order dated 21.03.2022 passed by National Faceless Appeal Centre (NFAC), Delhi for the quantum of assessment passed u/s, 143(3) for the assessment year 2017-18.

Chandrashekhar & Madhusudan Rane 2. The Assessee has challenged the addition of Rs. 17, 11,000/- on account of cash deposit under the following manner.

1. The Ld. Commissioner of income Tax (Appeals), NFAC, Delhi has erred in dismissing the appeal without adjudicating on the facts and material available on record that the cash deposits were in the bank accounts in the name of employer where the appellant is only signatory to account.

2.

The Ld. Commissioner of income Tax (Appeals), NFAC, Delhi has erred in confirming action of Ld. AO of adding Rs. 17,11,000/- to income of appellant.

3.

The brief facts of the case are that, assessee is in individual and is an employee with Sahara Credit Corporation Society Ltd. The assessee has filed return of income on 30.03.2018 declaring income of Rs.5,11,720/-. The case was selected for scrutiny under CASS on the ground that large value cash deposits during de- monetization period was made. In response to the notice Assessee had submitted the bank statements for the month of Nov-2016 for the companies of Sahara India & SUMSL in support of the cash deposit by his office. He clarified that he has deposited the cash as Chandrashekhar & Madhusudan Rane official of Sahara being one of the bank signatories, his pan was captured. The Assessing Officer try to serve the notice for further show cause through online, however, the same was not delivered or received by the Assessee. Accordingly he treaded the cash deposit in the bank account of Rs. 17, 11,000/- as unexplained assets and added the same u/s. 69A. The Ld. CIT (A) too as conformed the said addition.

4.

Before me, the Ld. Counsel submitted that, the bank statements belong to Sahara India and not the Assessee and the cash was deposited in the bank account of Sahara India and not the Assessee. He was only co-signatory. He also filed the copy of certificate issued by Sahara India & also by the Bank of India in which of amount deposited. The Ld. DR on the other hand, relied upon the order of Assessing Officer & CIT (A).

5.

After considering the relevant finding given in the impugned orders as well as material referred to before us, I find that the entire basis for making the addition is that, Assessee has deposited same cash correcting of Rs. 17,11,000/- in Bank of India. On a bare perusal said of the bank account the copy of which has been in Chandrashekhar & Madhusudan Rane placed in the paper book before me at page 3, it is clearly evident that account belongs to Sahara India and not the Assessee. Entire bank statement from the period 01.11.2016 to 31.12.2016 has been provided wherein, certain cash of deposit which has been wrongly inferred to be deposited in the account of the Assessee. Once, the bank in which cash was deposited belongs to some other entity the same could not have been taxed with hands of the individual Assessee.

The certified issued by Bank India & Sahara India which has been submitted before me reads as under:-

Chandrashekhar & Madhusudan Rane Chandrashekhar & Madhusudan Rane Chandrashekhar & Madhusudan Rane 6. Though, these are additional evidences however, these only certify that Assessee was not the owner of the Bank account and same belongs to Sahara India. Therefore, any addition on account of cash deposit cannot be made in the hands of the Assessee, accordingly, the same is deleted.

7.

In the result, Appeal of the Assessee is the allowed.

Orders pronounced in the open court on 28.11. 2022.

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