VINODKUMAR DHANULALJI SAWJI,JALNA vs. ITO WARD 1 , JALNA

There is a delay of 163 and 164 days in filing of ITA Nos. 1415 & 1416/PUN/2024. Applications for condonation of delay along with affidavits are placed on record. The main reason for delay is on account of illness of the assessee, who has been diagnosed with various types of ailments and was under medical treatment at Manik Hospital & Research Centre, Aurangabad. Considering the contentions made in the application for condonation of delay and also taking into consideration the judgments of Hon'ble Apex Court in the cases of of Collector, Land Acquisition, Anantnag & Anr. Vs. Mst. Katiji & Ors. [(1987) 2 SCC 107] and in the case of Inder 21.03.2025 (2025 INSC 382), we hereby condone the delay of 163 & 164 days in filing of the instant appeals in ITA Nos. 1415 & 1416/PUN/2024 respectively before this Tribunal and admit the appeals for adjudication. 3. Since the issues raised in both these appeals are common, first we take up ITA No. 1415/PUN/2024 for A.Y. 2014-15 as a lead case. The modified grounds of appeal raised by the assessee vide letter dated 13/06/2025 read as under:- “1. The Ld CIT(A), NFAC, Delhi, erred in upholding the initiation of reassessment proceedings under section 148 r.w.s. 147 without appreciating that there was no escapement of income in the AY 2014-15 as the assessee had declared the transactions under consideration under the Income Disclosure Scheme (IDS), 2016 and the reassessment proceedings were bad in law.

The Ld CIT(A), NFAC, Delhi, erred in not appreciating that the reassessment order passed by the Ld AO pursuant to the unlawful reassessment proceedings initiated under section 147/148 were bad in law liable to be set aside. 3. The Ld CIT(A), NFAC, Delhi, erred in sustaining the addition of Rs. 1,48,59,085/- made under section 68 of the IT Act without appreciating that the amount represented trading transactions on which net profit was already declared by the assessee under the Income Disclosure Scheme (IDS), 2016. 4. Without prejudice to the Ground Nos. 1, 2 and 3, the Ld CIT(A), NFAC, Delhi, erred in not appreciating that the proceedings were initiated based on incriminating materials found during search proceedings on 25.05.2017 in the premises of Shri Renukamata Multistate Urban Co-operative Credit Society Ltd. and proceeding for assessment were to be initiated under section 153C of the 1 T Act which override the provisions of section 147 and 148, rendering the reassessment proceedings under section 147/148 bad in law liable to be set aside 5. The above grounds of appeal are without prejudice to one another. 6. The appellant craves leave to furnish Additional Evidence which may be relevant to the above Grounds of Appeal in course of the appeal proceedings.”

The assessee also raised additional ground which reads as under:- “The Ld CIT(A), NFAC, Delhi, erred in sustaining the addition of Rs.1,48,59,085/- made under section 68 in respect of cash amount deposited in the bank account of the assessee without appreciating that the bank statement/ bank passbook is not books maintained by the assessee within the meaning of section 68 of the IT Act.”

At the outset, learned counsel for the assessee requested for not pressing the legal issues raised in the modified grounds of appeal filed in both the appeals for the years under consideration. Accordingly, ground Nos. 1, 2 & 4 are dismissed as not pressed.

So far as merits of the case are concerned, learned counsel for the assessee submitted that the impugned additions have been made on account of cash deposits in the bank account of the assessee held with Shri Renukamata Multistate Urban Co-operative Credit Society Ltd. and the additions have been made u/s. 68 of the Act for A.Y. 2014-15 at ₹ 1,48,59,085/- and for A.Y. 2015-16 at ₹ 2,28,33,930/-. He submitted that assessee has also filed application under the Income Disclosure Scheme, 2016 (IDS, 2016) for the undisclosed income for A.Y. 2014-15 & 2015-16 and also paid taxes. He further submitted that even though the assessee has carried out the alleged transactions of cash inflow and outflow in the course of carrying business, but in absence of proper details, the addition may be sustained for the peak credit for A.Y. 2014-15 and similarly for calculating the peak credit for A.Y. 2015-16, telescoping benefit of the peak credit calculated for A.Y. 2014-15 may please be allowed. He also submitted that out of the peak balance calculated for impugned assessment years relief may please be granted for the income declared under IDS, 2016. 7. On the other hand, ld. Ld. Departmental Representative (DR) supported the order of Ld. CIT(A). 8. We have heard rival contentions and perused the records placed before us. We observe that assessee is an individual and regular returns of income for A.Ys. 2014-15 & 2015-16