Loading judgment…
Facts
The assessee filed his return for AY 2015-16 and his case was selected for scrutiny. During the assessment, cash deposits of Rs. 25,22,500 were treated as unexplained and added to his income. The assessee claimed these deposits pertained to earlier savings and were made during demonetization period in FY 2016-17 (AY 2017-18).
Held
The Tribunal held that the addition made by the Assessing Officer was not acceptable for AY 2015-16, as the cash deposits were admittedly made during FY 2016-17, relevant to AY 2017-18. Therefore, the addition was deleted.
Key Issues
Whether cash deposits made in FY 2016-17 (AY 2017-18) can be added to the income of AY 2015-16 as unexplained cash credit under Section 68 of the Act.
Sections Cited
144, 68, 44AD
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘SMC’ BENCH, KOLKATA
Before: Shri Duvvuru RL Reddy, Vice-(KZ)
Assessment Year: 2015-2016 Tridip Roy,…………………………………….………Appellant Diglipur North Andaman, A & N Island, Port Blair, Union Territory of Andaman & Nicobar Island, Pin Code No. 744 202 [PAN:BEHPR1554L] -Vs.- Income Tax Officer,………………….…………...Respondent Ward-3(4), Port Blair, Aayakar Bhawan, VIP Road, Port Blair, Andaman & Nicobar Island, Pin Code No. 744101 Appearances by: Shri Akkal Dudhewala, A.R., appeared on behalf of the assessee Ms. Madhumita Das, Addl. CIT, appeared on behalf of the Revenue Date of concluding the hearing: February 24, 2025 Date of pronouncing the order: May 6th, 2025 O R D E R
The present appeal is directed at the instance of assessee against the order of ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 2nd May, 2024 passed for Assessment Year 2015-16. 1 (A.Y. 2015-2016) Tridip Roy
The appeal is time barred by 63 days in filing the appeal by the assessee. However, the assessee filed an affidavit dated 26th August, 2024 saying that due to illness of his wife and had to accompany her for hospitalization in another Island from Diglipur, North Andaman as well as for taking proper medical care, he was not aware of the order passed by the ld. CIT(Appeals). When the assessee came to know about the order passed by the ld. CIT(Appeals), the assessee approached the ld. A.R. to prefer an appeal, due to that there was a delay of 63 days in filing the appeal before the Tribunal. Therefore, he pleaded to condone the delay.
Considering the facts and circumstances of the case, I am of the view that the assessee was prevented in filing the appeal within the stipulated time. Therefore, I am inclined to condone the delay of 63 days. Hence the delay is condoned.
Briefly stated the facts are that the assessee filed his return of income for the assessment year 2015-16 declaring total income of Rs.3,54,470/-. The case was selected for scrutiny under CASS for the reason being ‘whether cash deposit has been made from disclosed sources or not’. The ld. Assessing Officer issued statutory notices to the assessee, but no compliance was made from the side of assessee. Thereafter the assessment was completed under section 144 of the Act on the basis of information available on record.
(A.Y. 2015-2016) Tridip Roy 5. Aggrieved by the order of ld. Assessing Officer, the assessee preferred an appeal before the ld. CIT(Appeals) and after considering the submissions made by the assessee, the ld. CIT(Appeals) dismissed the appeal filed by the assessee.
On being aggrieved, the assessee preferred an appeal before the ITAT and raised the following issues:- (1) For that on the facts and circumstances of the case, the lower authorities erred in adding the cash deposits of Rs.25,22,500/- by way of unexplained cash credit u/s 68 of the Act. (2) For that on the facts and in the circumstances of the case, the cash deposits of Rs.25,22,500/- made during the demonetization period pertained to the AY 2017-18 was erroneously treated as unexplained cash credit u/s 68 of the Act for the relevant AY 2015-16 and in that view of the matter, the addition being unsustainable deserves to be deleted in full.
I have heard both the sides. It was the submission of the assessee that the assessee was engaged in the jewellery business under his proprietorship in the name and style of M/s. Bichitra Jewellers. The assessee disclosed total turnover of Rs.44,85,250/- and computed his income on presumption basis under section 44AD of the Act disclosing Rs.3,62,067/- as income being 8.07% of his disclosed turnover. The total cash balance as on 31.03.2015 had been shown at Rs.8,29,972/-. The assessee had deposited cash of Rs.25,22,500/- in his three Bank accounts, though the assessee filed his submissions that the total cash deposit was relating to earlier income/savings only. The ld. A.R. of the assessee submitted that the ld. Assessing Officer as well as ld. CIT(Appeals) have not considered the submissions made by the ld. assessee and 3 (A.Y. 2015-2016) Tridip Roy the total deposited amount of Rs.25,22,500/- in the Bank account was treated as unexplained and added back to the total income of the assessee for the assessment year 2015-16 under section 68 of the Act. He further submitted that the assessee has deposited cash amounting to Rs.25,22,500/- during 9th November, 2016 to 30th December, 2016 in his three Bank accounts. The said amount was related to earlier income/savings only, but the same reply was filed before the ld. Assessing Officer as well as ld. CIT(Appeals). The ld. Assessing Officer wrongly added this amount of Rs.25,22,500/- to the total income of the assessee for the assessment year 2015-16. Therefore, both the lower authorities were wrong in making the addition of Rs.25,22,500/- for the assessment year 2015-16. The assessee failed to explain the source and the ld. Assessing Officer made the addition of Rs.25,22,500/- for the assessment year 2017-18 since the assessee has deposited the amount of Rs.25,22,500/- during financial year 2016-17. Therefore, he pleaded to set aside the orders passed by the revenue authorities.
On the other hand, ld. Departmental Representative relied on the orders passed by the lower authorities.
Heard the rival submissions and perused the material available on record. It is an admitted fact that the assessee has deposited an amount of Rs.25,22,500/- in his three bank accounts. The three Bank accounts of the assessee enumerated as under:- Sl. Name of the Account No. Amount No. Bank deposited (in Rs.) 4 (A.Y. 2015-2016) Tridip Roy 1. Axis Bank Ltd. 9110100534370 Rs.7,00,000/- 2. State Bank of 11741211699 Rs.8,22,500/- India 3. Syndicate 99133070001640 Rs.10,00,000/- Bank Admittedly all the cash deposits were made during the financial year 2016-17 relevant to assessment year 2017-18, but the ld. Assessing Officer as well as ld. CIT(Appeals) wrongly added the cash deposits of Rs.25,22,500/- during assessment year 2015-16. Therefore, I am of the firm view that the addition made by the ld. Assessing Officer is not acceptable for the assessment year 2015- 16. The ld. Assessing Officer wrongly made the addition of Rs.25,22,500/- and added to the total income of the assessee for the assessment year 2015-16. Therefore, the addition made by the ld. Assessing Officer is hereby deleted. The grounds raised by the assessee are allowed.
In the result, the appeal of the assessee is allowed. Order pronounced in the open Court on 06/05/2025.