GANDHI SOKKAIAH CHETTIAR GUNASEKARAN,MADURAI vs. ITO,NON-CORPORATE WARD 2(2), MADURAI

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ITA 142/CHNY/2022Status: DisposedITAT Chennai19 September 2022AY 2017-183 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal directed the AO to re-compute the income by adding Rs. 48,000/- as rental income, allowing telescoping benefit for Rs. 1,84,500/-, and accepting Rs. 2 Lacs out of past savings/gifts. The balance addition sustained was Rs. 1.82 Lacs.

What were the facts?

The assessee had unexplained cash deposits of Rs. 6.14 Lacs in various bank accounts. The Assessing Officer added this amount as unexplained money, which was confirmed by the CIT(A).

What were the issues?

Whether cash deposits in bank accounts can be treated as unexplained money and added to income. Whether the assessee can provide satisfactory explanation for the source of such deposits.

Which sections of the Income-tax Act were involved?

Section 69A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A/SMC’ BENCH, CHENNAI

Before: SHRI MANOJ KUMAR AGGARWAL, AM

आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2017-18 arises out of the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 27-12-2021 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s.143(3) of the Act on 03-12-2019. The sole grievance of the assessee is confirmation of addition of Rs.6.14 Lacs. Having heard rival submissions, the appeal is disposed-off as under.

2.

The assessee being resident individual is stated to have earned commission income. Upon perusal of details filed by the assessee during assessment proceedings, it transpired that the following banks were not accounted for by the assessee for computing the total income: - No. Bank Account No. Amount (Rs.) 1. BOI A/c No. 06970 1,17,500/- 2. HDFC A/c No. 2115 4,92,000/- 3. HDFC A/c No. 7662 5,000/- Total 6,14,500/- Accordingly, the cash deposit of Rs.6.14 Lacs was added as unexplained money u/s 69A. The Ld. CIT(A) confirmed the additions. Aggrieved the assessee is in further appeal before us.

3.

During hearing, Ld. AR submitted that small amounts were deposited to repay monthly EMIs for Auto Loan and Housing Loan. The cash deposit during demonetization period is stated to be Rs.0.54 Lacs. The source of deposit is sought to be explained as under: - No. Particulars Amount (Rs.) 1. Rental Income not accounted for 48,000/- 2. Withdrawal from HDFC A/c No.2115 1,84,500/- which is to be telescoped 3. Past Savings / Gifts 3,82,000/- Total 6,14,500/- The copies of Bank statements have been placed on record which has been perused. Upon careful consideration, I direct Ld. AO to re- compute the income of the assessee by adding Rental Income of Rs.48,000/- which would be entitled for standard deduction as applicable. The telescoping benefit would be granted and accordingly, the addition of Rs.1,84,500/- would stand deleted. Considering the fact that the assessee is above 55 years of age, past savings / gifts may be accepted to the extent of Rs.2 Lacs. The balance addition as sustained would be Rs.1.82 Lacs. I order so.

4.

The appeal stands partly allowed.

Order pronounced on 19th September, 2022.

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