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RADHA CHANDRABABU PANIKAR,AHMEDABAD vs INCOME TAX OFFICER, WARD 3(2)(9), AHMEDABAD, AHMEDABAD | BharatTax

RADHA CHANDRABABU PANIKAR,AHMEDABAD vs. INCOME TAX OFFICER, WARD 3(2)(9), AHMEDABAD, AHMEDABAD

ITA 958/AHD/2025Status: DisposedITAT Ahmedabad27 August 2025AY 2011-12Bench: SMT. ANNAPURNA GUPTA (Accountant Member)5 pages

AI SummaryAllowed

Facts

The assessee, a non-filer of income tax returns, had Rs. 11.75 lakhs cash deposited in her bank account in AY 2011-12, which was used for her son's credit card dues abroad. An assessment was framed under Section 147 for unexplained cash. The assessee claimed the source was loans from her deceased husband and brother, and tuition income.

Held

The Tribunal found the assessee's explanation plausible, particularly regarding the loans from her deceased husband and the ledger confirmation from her brother. It noted the Revenue failed to prove any income-generating activity by the assessee. Consequently, the addition of Rs. 11.75 lakhs was deleted, and the corresponding penalty under Section 271(1)(c) was also deleted.

Key Issues

Whether the cash deposits in the assessee's bank account, explained as loans from her deceased husband and brother, constitute unexplained income under Section 147 of the Income Tax Act, and whether a penalty under Section 271(1)(c) is leviable in such circumstances.

Sections Cited

147, 144, 271(1)(c)

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Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD

Before: SMT. ANNAPURNA GUPTA

For Appellant: Shri Chetan Agarwal, A.R, Shri Nitin Kulkarni, Sr. DR

For Respondent: Shri Nitin Kulkarni, Sr. DR

Pronounced: 27/08/2025

O R D E R Both the appeals relate to the same assessee and pertain to the same Assessment Year (A.Y.) 2011-12; while one is against the order passed by the Ld. Commissioner of Income Tax (Appeals)(in short “CIT(A)”), National Faceless Appeal Centre (hereinafter referred to as “NFAC”), Delhi dated 07.03.2025 in quantum proceedings in assessment order passed under Section 147 of the Income Tax Act, 1961 (hereinafter referred to as the “Act”), the other appeal lies against order of the Ld. CIT(A) confirming the levy of penalty under Section 271(1)(c) of the Act on the addition made to the income of the assessee in the quantum proceedings.

1.

& 959/Ahd/2025 [Radha Chandrababu Panikar vs. ITO] A.Y. 2011-12 - 2 – 2. Issues involved in both the appeals being interrelated they were taken up together for hearing and are being disposed of by this common order for the sake of convenience.

4.

At the outset, Ld. Counsel for the assessee pointed out that the solitary issue in the present appeal relates to addition made to the income of the assessee on account of cash found deposited in her bank account in the impugned year i.e. A.Y. 2011-12 remaining unexplained. Assessment, it was stated, was framed u/s.147 of the Act, the AO being in possession of information of cash amounting to Rs.11,75,000/- being deposited in her bank account during the year. The assessment order was passed ex parte u/s.144 of the Act in the absence of any co-operation by the assessee. During the first appellate proceedings before the Ld. CIT(A), the assessee, it was pointed out, filed additional evidences to justify the source of cash deposits as being sourced from loan given by her husband and her brother and partly from income earned by her by giving tuitions. But, in the absence of any corroborative evidence justifying the said explanation, the Ld. CIT(A) confirmed the addition made in the hands of the assessee.

& 959/Ahd/2025 [Radha Chandrababu Panikar vs. ITO] A.Y. 2011-12 - 3 – 6. I have heard both the parties and gone through the order of the Ld. CIT(A). The fact on record is that the assessee was a non-filer of return of income. She never had any source of income sufficient enough to be liable to be taxed thereon, even in the past or in the future. During the impugned year, the cash deposited in her bank account admittedly was used to pay the credit card dues of her son who was studying abroad. These are facts on record and are evident from the copy of the bank statement of the assessee also wherein immediately after the cash deposited in her bank account, the same has been used to pay for credit card dues of her son who was studying abroad. The assessee’s contention, therefore, are that the cash deposited in her bank account in no way represent her income, appears to be plausible explanation. Even, the Revenue has failed to unearth any activity being carried out by her to justify the earning the quantum of cash which is found deposited in her bank account. So far as per explanation of the same being given to her by her husband and brother, we have noted that though she has attempted to justify the same by filing confirmation of her husband and brother. The Ld. CIT(A) has noted the confirmation of loan received by her husband to be signed by herself while that received from her brother, he has noted the evidence to be in the form of a ledger confirmation. With respect to the cash stated to be received from her husband, the Ld. CIT(A) has noted the submissions of the assessee before him that during the course of appellate proceedings her husband had expired, therefore, clearly the assessee is in no position to justify her explanation of cash being given to her via husband. So far as the cash loan received & 959/Ahd/2025 [Radha Chandrababu Panikar vs. ITO] A.Y. 2011-12 - 4 – from her brother is concerned, even the Ld. CIT(A) noted the confirmation to this effect having been filed by the assessee. In the backdrop of the above facts where the assessee has no identified the source of income either in the past or in future, therefore, her explanation of source of cash being received from her husband needs to be treated as explained and cannot be rejected for lack of credible evidence, since her husband is deceased and the possibility of furnishing any concrete evidence stands diminished. So far as the loan received from her brother that the ledger confirmation of the brother being on record, the same suffices. In the light of the same, we see no reason to confirm the addition made in the hands of the assessee on account of cash found deposited in the bank account to the tune of Rs.11.75 Lakhs and direct the same to be deleted.