CHANNEGOWDA CHANNANKAIAH,KARNATAKA vs. ITO, WARD-1, RAMANAGAR

This appeal is filed by the assessee against the order of the Addl/JCIT(A)-2, Vadodara vide order dated 03/05/2025 in DIN No.ITBA/APL/S/250/2025-25/1064608524(1) for the assessment year 2017-18.

The only issue raised by the assessee is that the learned CIT(A) erred in confirming the order of the AO while sustaining the addition of ₹6,00,000 as unexplained cash credit under section 69A of the Act.

In the present case, the AO during the assessment proceedings found that the assessee deposited cash in his bank account in the year under consideration amounting to ₹10,34,075.00 only. The AO held that the assessee failed to justify the source of cash deposit to the extent of ₹6,00,000 out of the total cash deposits of ₹10,34,075. Accordingly, the AO treated the sum of ₹6,00,000 as unexplained money under section 69A of the Act.

On appeal, the learned CIT(A) upheld the finding of the AO by observing that the assessee failed to justify the source of cash deposit in the bank with documentary evidence.

Being aggrieved by the order of the learned CIT(A), the assessee is in appeal before us.

The learned AR submitted that the assessee is engaged in the profession of deed/document writer. According to the AO, the assessee received ₹6,00,000 as custodian in respect of two properties leased by the owners to third parties. The learned AR filed the lease agreements before us. It was further submitted that these agreements were not filed before the lower authorities. Accordingly, the learned AR prayed to set aside the issue to the file of the AO for fresh adjudication as per law.

On the other hand, the learned DR strongly supported the orders of the lower authorities. However, he left the issue to the discretion of the Bench, whether to restore the matter to the AO for fresh adjudication.

We have heard the rival submissions and perused the materials on record. From the discussion above, we note that the assessee has filed the lease agreements for the first time before us to justify that the cash deposited in the bank was received from the lessees on behalf of the property owners. The assessee claimed that he only acted as a custodian and subsequently transferred the money to the property owners. These facts were not verified by the lower authorities due to lack of supporting documents. Now, the learned AR has filed the lease agreements, which in our view are crucial to decide the issue. Accordingly, we admit the additional evidence and set aside the finding of the learned CIT(A), and restore the issue to the file of the AO for fresh adjudication as per law. Hence, the ground of appeal raised by the assessee is allowed for statistical purposes.

In the result, the appeal filed by the assessee is allowed for statistical purposes.