Loading judgment…
Facts
The assessee, an individual with no taxable income, made cash deposits of Rs. 54,98,000/- into her bank accounts. The Assessing Officer, during reassessment proceedings under Section 147 and 148, treated Rs. 54,58,000/- as unexplained cash under Section 69A read with Section 115BBE, as he was not satisfied with her explanation that the cash was received from family members for her son's VISA expenses. The CIT(A) subsequently dismissed the assessee's appeal ex-parte for non-prosecution, upholding the addition.
Held
The Tribunal noted conflicting claims regarding the submission of evidence (husband's bank statements showing cash withdrawals) between the assessee and the Assessing Officer, and the assessee's failure to appear before the CIT(A). Concluding that the matter required fresh examination, the Tribunal set aside the CIT(A)'s order and restored the case to the Assessing Officer, directing him to verify the relevant evidences filed by the assessee to prove the source of cash deposit.
Key Issues
1. Whether the CIT(A) was justified in dismissing the appeal ex-parte for non-prosecution without providing an effective opportunity of hearing. 2. Whether the addition of cash deposits as unexplained cash under Section 69A was warranted, given the assessee's explanation and claim of having supporting evidence.
Sections Cited
147, 148, 142(1), 144B, 69A, 115BBE, 69
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, HYDERABAD “B” BENCH: HYDERABAD
Before: SHRI MANJUNATHA G & SHRI RAVISH SOOD
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD “B” BENCH: HYDERABAD BEFORE SHRI MANJUNATHA G, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER ITA.No.198/Hyd./2025 Assessment Year 2016-2017 The Income Tax Officer, Palleboyina Manju Rani, Hyderabad – 500 057 Ward-7(1), vs. Telangana. Hyderabad-500 084. PAN BWFPM5188R Telangana. (Appellant) (Respondent) For Assessee : Shri Mohd. Afzal, Advocate For Revenue : MS. Reema Yadav, Sr. AR Date of Hearing : 30.04.2025 Date of Pronouncement : 30.04.2025 ORDER PER MANJUNATHA G. :
This appeal has been filed by the assessee against the order dated 01.01.2025, of the learned CIT(A)-National Faceless Appeal Centre [in short the “NFAC”] Delhi, relating to the assessment year 20162017.
Briefly stated facts of the case are that, the assessee is an individual having no taxable income. As per
2 ITA.No.198/Hyd./2025 the information available with the Department, the assessee had made certain cash deposits in her Bank account of Rs.54,98,000/- with Andhra Bank, Vijaya Nagar Colony and HDFC Bank, Mehdipatnam, Hyderabad. The case was selected for scrutiny and after recording reasons u/sec.147 of the Income Tax Act, 1961 [in short “the Act”], the Assessing Officer issued notice u/sec.148 of the Act on 30.03.2023. In response, the assessee filed her return of income on 25.04.2023 declaring income of Rs.40,910/-. The Assessing Officer issued notices u/sec.142(1) of the Act on 12.09.2023 calling explanation from the assessee with regard to the above cash deposit into bank account. The assessee in her reply dated 11.11.2023 submitted that, the said cash received from family members for the purpose of VISA approval of her son who got offer letter from Navitas at UMass Bostal from USA and filed requisite letter and other documentary evidences. However, the Assessing Officer had not satisfied with the explanation and documents furnished by the assessee and treated the cash deposit of Rs.54,58,000/- as unexplained cash u/sec.69A
3 ITA.No.198/Hyd./2025 r.w.s.115BBE of the Act and accordingly determined the total income of the assessee at Rs.55,38,910/- by making addition of Rs.54,98,000/- as against the returned income of assessee at Rs.40,910/- vide order dated 28.02.2024 passed u/sec.147 r.w.s.144B of the Income Tax Act, 1961.
On being aggrieved, the assessee carried the mater in appeal before the learned CIT(A) contending, inter alia, that before the Assessing Officer the assessee has explained the source for cash deposit out of amount received from family members. However, the Assessing Officer has not accepted the explanation of assessee and made addition u/sec.69A r.w.s.115BBE of the Act. The learned CIT(A) has issued notices during the course of first appellate proceedings. The assessee responded initially for three notices and sought adjournment and the same has been granted by the learned CIT(A). Subsequently, the assessee neither appeared nor filed any details. Therefore, the learned CIT(A) dismissed the appeal filed by the assessee ex-parte for non-prosecution and sustained the addition made towards cash deposit.
4 ITA.No.198/Hyd./2025 4. Shri Mohd. Afzal, Advocate-Learned Counsel for the Assessee, submitted that the learned CIT(A) has not given effective opportunity of hearing and dismissed the appeal filed by the assessee for non-prosecution without even considering the facts of the case brought on record along with Form-35. Therefore, he further submitted that, the appeal may be set aside. The assessee has explained source of cash deposit out of cash withdrawals from assessee’s husband’s bank account and for which, the assessee has furnished relevant bank statements. Although, the assessee has furnished all details, the learned CIT(A) ignoring the evidences filed by the assessee has made addition. Therefore, he submitted that the matter may be restored back to the file of Assessing Officer to provide one more opportunity to the assessee to substantiate her case.
MS. Reema Yadav, Sr. AR for the Revenue, supporting the order of the learned CIT(A) submitted that, the assessee did not appear before the learned CIT(A) when the appeal was posted for hearing. In absence of relevant evidences for cash deposit into bank account, the learned
5 ITA.No.198/Hyd./2025 CIT(A) has sustained the addition made by the Assessing Officer u/sec.69 of the Act. Further, the assessee has explained source for cash deposit out of amount received from members without specifying the name of the husband. Now the assessee has changed her stand and claims that she has received the amount from her husband. In absence of relevant evidences, the learned CIT(A) has rightly sustained the addition made by the Assessing Officer and therefore, she submitted that, the order of the learned CIT(A) be upheld.
We have heard both the parties, perused the material on record and the orders of the authorities below. There is no dispute with regard to the fact that the assessee has made cash deposit of Rs.54,58,000/- into the bank account. The assessee has explained source for cash deposit out of amount received from her family members to prove/show sufficient cash balance in her bank account for the purpose of getting VISA for her son who got offer letter from Navitas at UMass Boston from USA. The assessee has furnished relevant bank statements of her husband and her
6 ITA.No.198/Hyd./2025 bank account statements and prove that sufficient amount of cash has been withdrawn from her husband’s bank account and the same has been deposited in her bank account. We find that, the assessee’s husband bank account show sufficient cash withdrawal either on the same day or on the previous date of cash deposit into her bank account. The assessee claims that she has furnished all evidences including relevant bank statements before the Assessing Officer. But, the Assessing Officer says that, assessee has not filed any evidences. Therefore, the facts are contradictory. Before the learned CIT(A), the assessee could not appear and explain the case with relevant evidences. Therefore, we are of the considered view that, matter needs fresh examination from the Assessing Officer in light of evidences filed by the assessee to prove the source of cash deposit. Thus, we set-aside the order of the learned CIT(A) and restore the matter back to the file of Assessing Officer with a direction to verify the case with relevant evidences filed by the assessee to prove source of cash deposit.
7 ITA.No.198/Hyd./2025 Accordingly, the grounds raised by the assessee are allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open Court on 30.04.2025