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Facts
The assessee filed his return declaring a certain income. The Assessing Officer (AO) reopened the assessment under Section 147 as large cash deposits were made in a bank account which the assessee did not account for in his return. The AO made additions under Section 68 of the Income Tax Act, 1961, for the assessment years 2014-15, 2015-16, and 2016-17.
Held
The Tribunal restored the issue to the file of the Assessing Officer, granting the assessee one final opportunity to substantiate the source of cash deposits with evidence. The Assessing Officer is directed to decide the issue afresh after considering the submissions and evidence.
Key Issues
Whether the additions made by the Assessing Officer under Section 68 for unexplained cash deposits are justified, and if the assessee should be given a final opportunity to substantiate the source of funds.
Sections Cited
147, 68, 143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “B”, PUNE
Before: SHRI R. K. PANDA & MS. ASTHA CHANDRA
The above three appeals filed by the assessee are directed against the separate orders dated 29.07.2024 of the Ld. CIT(A) / NFAC, Delhi relating to assessment years 2015-16, 2016-17 and 2014-15, respectively. Since identical grounds have been raised in all the 3 appeals, therefore, these were heard together and are being disposed of by this common order for the sake of convenience,. for assessment year 2015-16 as the lead case. Facts of the case, in brief, are that the assessee is an individual and has filed his return of income on 10.02.2016 declaring total income of Rs.5,59,710/-. Information was available with the department that the assessee has deposited huge cash to the tune of Rs.1,33,28,575/- in the bank account maintained with M/s. Shri Renuka Mata Multi State Urban Cooperative Credit Society Ltd. On going through the return of income filed by the assessee, the Assessing Officer noted that the assessee has not taken into account the above amount of cash deposit. The Assessing Officer, therefore, after recording the reasons, reopened the assessment u/s 147 on the ground that the cash deposited amounting to Rs.1,33,28,575/- has escaped assessment. The assessee made part compliance to the statutory notices issued by the Assessing Officer. However, the assessee could not substantiate with evidence to the satisfaction of the Assessing Officer regarding the source of such cash deposits. The Assessing Officer, therefore, completed the assessment determining the total income of the assessee at Rs.1,40,18,535/- by making addition of Rs.1,33,28,575/- u/s 68 of the Income Tax Act, 1961. Similar addition of Rs.41,40,865/- was made by the Assessing Officer for assessment year 2016-17 and Rs.58,14,766/- for assessment year 2014-15.
The assessee filed appeals before the Ld. CIT(A) / NFAC for all the above three years. However, despite number of opportunities granted by the Ld. CIT(A) / NFAC, there was no compliance from the side of the assessee for which the Ld. CIT(A) / NFAC upheld the action of the Assessing Officer and dismissed all the appeals filed by the assessee for the above three years vide separate orders.
Aggrieved with such order of the Ld. CIT(A) / NFAC, the assessee is in appeal before the Tribunal challenging the order of the Ld. CIT(A) / NFAC in confirming the additions made by the Assessing Officer for the respective years.
We have heard the rival arguments made by both the sides and perused the orders of the Assessing Officer and Ld. CIT(A) / NFAC. It is an admitted fact that due to non-compliance before the Assessing Officer, he made addition u/s 68 of the I.T. Act, 1961 for the above three years being the amount of cash deposited in the bank account maintained with M/s. Shri Renuka Mata Multi State Urban Cooperative Credit Society Ltd. on the ground that the assessee did not explain the nature and source of such cash deposits. We find despite number of opportunities granted by the Ld. CIT(A) / NFAC, the assessee did not make any submission for which the Ld. CIT(A) / NFAC upheld the addition made by the Assessing Officer. It is the submission of the Ld. Counsel for the assessee that given an opportunity, the assessee is in a position to substantiate his case by filing the requisite details with evidence to the satisfaction of the Assessing Officer regarding the nature and source of such cash deposits made in the bank account. Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the Assessing Officer with a direction to grant one final opportunity to the assessee to substantiate his case by filing the requisite details to his satisfaction and decide the issue as per fact and law after giving due opportunity of being heard to the assessee. The assessee is also hereby directed to make his submission, if any, before the Assessing Officer on the appointed date without seeking any adjournment under any pretext, failing which the Assessing Officer is at liberty to pass appropriate order as per law. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes for all the three years.
In the result, all the three appeals filed by the assessee are allowed for statistical purposes.
Order pronounced in the open Court on 30th January, 2025.
Sd/- Sd/- (ASTHA CHANDRA) (R. K. PANDA) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; दिन ांक Dated : 30th January, 2025 GCVSR आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to:
1. 1. अपीलार्थी / The Appellant; प्रत्यर्थी / The Respondent 2.