RAJESH AGARWAL,KOLKATA vs. ITO, WARD 25(3),, KOLKATA

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ITA 1898/KOL/2025Status: DisposedITAT Kolkata24 October 2025AY 2015-2016Bench: the learned CIT(A), who sustained the order of the Assessing Officer, granting partial relief. The assessee is now in further appeal before the Tribunal.4 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 found that the ₹3,00,000 difference in bank balance was indeed due to a timing difference in cheque clearance, supported by a bank reconciliation statement and other evidence. It concluded that there was no unexplained cash credit or concealed income. The Tribunal directed the Assessing Officer to delete the addition of ₹3,00,000.

What were the facts?

The assessee filed its return for AY 2015-16, which was selected for scrutiny. The Assessing Officer made several additions, including ₹3,00,000 for unexplained cash credit, which was largely sustained by the CIT(A). The assessee contended that the ₹3,00,000 difference in bank balance was a timing issue related to a cheque deposited before year-end but cleared after year-end, not an unexplained credit, and did not press other grounds of appeal.

What were the issues?

Whether the addition of ₹3,00,000 as unexplained cash credit, based on a difference between the bank balance as per books and as per bank statement, was justified, or if it was merely a timing difference in cheque clearance.

Which sections of the Income-tax Act were involved?

Section 250,Section 143(1),Section 143(2),Section 142(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, KOLKATA

Appearances by: Assessee represented by : Anil Kochar, Adv. Department represented by : Sanjib Kumar Paul, Addl. Sr. DR Date of concluding the hearing : 23.10.2025 Date of pronouncing the order : 24.10.2025 O R D E R

PER SONJOY SARMA, JUDICIAL MEMBER:

1.

1. The present appeal is filed against the order u/s 250 of the Income Tax Act, 1961 (hereafter “the Act”), dated 08.08.2025, passed by the Ld. Additional/Joint Commissioner of Income Tax (Appeals)-2, Lucknow (hereafter “the Ld. Addl./JCIT(A)].

2.

Brief facts of the case are that the assessee filed its return of income for the assessment year 2015–16 declaring a total income of ₹ 10,20,410/-. The return was processed under Section 143(1) of the Act. Subsequently, the case was selected for scrutiny to examine certain issues, and notices under Sections 143(2) and 142(1) were issued. In response, the assessee furnished the requisite details, books of accounts, and bank

1.

₹2,47,261 on account of low gross profit,

2. ₹25,000 on account of donation, and

3.

₹3,00,000 on account of difference in closing bank balance (treated as unexplained cash credit).

Accordingly, the total income was assessed at a higher figure.

3. The assessee preferred an appeal before the learned CIT(A), who sustained the order of the Assessing Officer, granting partial relief. The assessee is now in further appeal before the Tribunal.

4.

At the time of hearing, the learned Authorised Representative (AR) submitted that grounds No. 1 and 2 are not pressed. Therefore, the only issue surviving for adjudication is with respect to the addition of ₹ 3,00,000/-, being the difference between the bank balance as per books and as per bank statement.

5.

The learned AR explained that as per the books of accounts, the closing bank balance in ING Vysya Bank Ltd. was ₹25,90,866.29, whereas as per the bank statement, the closing balance was ₹22,90,866.29, resulting in a difference of ₹ 3,00,000/-. It was submitted that the difference was only due to a cheque of ₹3,00,000/- received from Deepak Traders vide cheque No. 189773 dated 28.03.2015, which was deposited by the assessee before 31.03.2015 but was cleared only on 04.04.2015. The assessee also furnished a bank reconciliation statement and copy of the account of Deepak Traders to substantiate the claim that the said difference arose merely due to timing difference in cheque clearance and not due to any unexplained cash credit.

6.

The learned Departmental Representative (DR) fairly did not raise any serious objection but submitted that at the time of assessment, the

7.

We have considered the rival submissions and perused the material available on record. It is an undisputed fact that the difference of ₹ 3,00,000/- between the bank balance as per books and as per bank statement was on account of a cheque received from Deepak Traders dated 28.03.2015, which was deposited before the end of the financial year but cleared by the bank on 04.04.2015. This explains the timing difference and fully reconciles the variation between the two balances. The reconciliation statement and supporting evidence produced by the assessee substantiate that there was no unexplained cash credit or concealed income on the part of assessee.

8.

Accordingly, we find no justification for sustaining the addition of ₹ 3,00,000/-. The same is, therefore, directed to be deleted.

9.

The appeal of the assessee is allowed and the Assessing Officer is directed to delete the addition of ₹ 3,00,000/- made on account of difference in bank balance as made in the case of assessee.

10.

In terms of the above, appeal of the assessee is allowed.

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