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Income Tax Appellate Tribunal, “F” BENCH, MUMBAI
Before: SHRI AMIT SHUKLA & SHRI AMARJIT SINGH
आदेश / O R D E R Per Amarjit Singh (AM): The present appeal filed by the assessee is directed against the order passed the NFAC, Delhi, dated 01.06.2022 for A.Y. 2017-18. The assessee has raised the following grounds before us:
“1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A)- NFAC erred in confirming addition of Rs. 18,05,000/- (Rs 17.50,000/- cash deposited in Axis bank Ltd and Rs.55,000/- cash deposited in Karnataka Bank Ltd) as unexplained cash credit u/s 68 of the Income Tax Act, 1961.
2 Mehul Dilip Mehta Vs. ACIT, Circle 30(2) a. On the facts and in the circumstances of the case and in law, the Ld. CIT(A)- NFAC ought to have considered that the appellant has made cash deposit in bank as per below table and detailed cashflow statement was provided during scrutiny proceedings as well as during hearing before first appellate authority. During the both the proceedings, both the Id. Authorities has never asked for cash book, but in assessment order the Id. AO mentioned that since cash book is not provided. he is making additions, the Id. CIT(A) also reproduced the whole content of the assessment order as it is without making independent inquiry. The assessee did provide the bank statement of the current and previous year showing sufficient cash withdrawal from bank as well as details date wise cashflow statement to show that he has sufficient cash in hand at the end of the previous year as well as during the current financial year. Sr. No. Particulars Amount 1 Opening Balance 01.04.2016 10,45,000 2 Add: Withdrawn from banks during the year 10,64,000 3 Add: Project Consultancy Fees received 600,000 (Declared in ITR) 4 Less: Credit Card Payments 600,300 5 Less: Deposited in Bank 18,05,000 Closing Balance 31.03.2017 3,03,700 2. On the facts and in the circumstances of the case and in law, the Ld CIT(A)- NFAC erred in confirming addition of Rs.6.10,314/- of consultancy fees received as unexplained cash credit u/s 68 of the Income Tax Act, 1961 even though the income of Rs. 6,10,314- was disclosed in the ITR filed by the appellant.
On the facts and in the circumstances of the case and in law, the Ld the Ld. CIT(A)-NFAC ought to consider that the assessee is not required to fill cash in hand amount in ITR as per law and hence not mentioned the same in ITR.
The assessee craves Your Honour's leave to add, alter or amend or delete any of the above grounds.”
Fact in brief is that return of income declaring total income at Rs.26,96,450/- was filed on 24.11.2017. The case was subject to scrutiny assessment and notice u/s 143(2) of the Act was issued on 08.08.2018. During the course of assessment the A.O found that assessee has deposited a sum of Rs.17,95,914/- during the year under consideration and also made the payment of credit card in cash to the amount of Rs.6,10,300/-. On query the assessee explained that amount of Rs.6,00,000/- pertained to project consultancy fees received by him in cash from various parties. He further stated that remaining cash was 3 Mehul Dilip Mehta Vs. ACIT, Circle 30(2) deposited in the accounts out of available cash in hand which was to the amount of Rs.10,45,000/- as per the cash book. The A.O has not agreed with the submission of the assessee stating that as per opening balance of cash book as on 01.04.2016 there was balance of Rs.10,45,000/-, however, the assessee has not shown the same as cash in hand in the return of income filed for assessment year 2016-17. Regarding receiving of consultancy fees of Rs.6,00,000/- in cash from various parties, the A.O stated that assessee has not filed any documentary evidences and confirmations from the parties in support of his claim, therefore, the A.O concluded that the cash deposited of Rs.17,95,914/- during the year under consideration and the payment of credit card in the cash to the amount of Rs.6,10,300/- were nothing but the unexplained cash credit, therefore, a sum of Rs.24,06,214/- [Rs.17,95,914/- (+) Rs.6,10,300/-] was added to the total income of the assessee as unexplained cash credit u/s 68 of the Act.
3. Aggrieved, the assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has partly allowed the appeal of the assessee. The relevant part of the decision of CIT(A) is as under: “5.3 I have considered the facts and circumstances of the case, submissions of the appellant and material available on record on the above matter. As per assessment order appellant has made cash deposits as under:
Sr. No. Bank Account Amount of cash deposit 1. Axis Bank Ltd. A/c 17,50,000 915010042422514 2. Karnataka Bank Ltd. A/c 55,000 No 0932500101628401 3. Saraswat Bank A/c No. 40,414 33910010000314 Total 18,45,414 4 Mehul Dilip Mehta Vs. ACIT, Circle 30(2) Appellant has claimed that the Saraswat A/c No. 33910010000314 pertain to M/s Walter Dorairaj hair and Beauty (PAN – AACFW2076J). Appellant has submitted copy of Bank account statement reflecting the account in the name of M/s Walter Dorairaj hair and Beauty. In view of the above A.O is directed to delete the addition of Rs.40,414/-.
On perusal of the assessment order it is seen that appellant has made cash deposits of Rs.18,05,000/- (Rs.17,50,000 + Rs.55,000). However, it appears that the A.O has by mistake calculated total at Rs.17,95,914/- (which include Rs.40,414 deposited in Saraswat Bank). In view of the above A.O may rectify the same on basis of material available on record.”