REENA,PATIALA vs. ITO WARD 1 PATIALA, PATIALA

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ITA 272/CHANDI/2025Status: DisposedITAT Chandigarh18 August 2025AY 2017-18Bench: us.3. The Ld. AR has placed on record cash flow of the assessee as under: - | No. | Nature of Source of Cash | Amount Received | |:----|:--------------------------------------------|:----------------| | 1. | Cash received on sale of properties during FY 2015-16 | Rs.14.25 Lacs | | 2. | Cash received on sale of properties during FY 2016-17 | Rs.7.43 Lacs | | 3. | Re-deposit of cash withdrawn | Rs.3.00 Lacs | | 4. | Business Receipts in cash | Rs.9.63 Lacs | | | Total | Rs.34.31 3 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal observed that the assessee had provided sufficient evidence, including cash flow statements and cash books, to demonstrate the sources of the cash deposits, primarily from property sales, withdrawals, and business receipts. Consequently, the impugned addition of Rs.21.09 Lacs made by the AO was deleted, and the AO was directed to accept the assessee's computation of income after due verification and re-compute the income.

What were the facts?

The assessee's case was scrutinized for cash deposits totaling Rs.21.09 Lacs for Assessment Year 2017-18. The Assessing Officer (AO) made an addition on a best judgment basis under Section 144, which was subsequently confirmed by the CIT(A) due to the absence of acceptable evidence for the source of these deposits.

What were the issues?

Whether the assessee successfully discharged the onus of proving the sources of cash deposits used for making impugned bank deposits.

Which sections of the Income-tax Act were involved?

Section 144,Section 80TTA

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, CHANDIGARH

Before: HON’BLE SHRI LALIET KUMAR, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

(िनधा�रणवष� / Assessment Year: 2017-18) Ms. Reena ITO बनाम/ Vs. 1989 &1990/3 Gainda Ram Street Ward No 1, RaghoMajra, Patiala. Patiala. �थायीलेखासं./जीआइआरसं./PAN/GIR No. AQSPR-8505-M (अपीलाथ�/Appellant) : (��थ� / Respondent) अपीलाथ�कीओरसे/ Appellant by : Shri Rajiv Saldi (CA) – Ld. AR ��थ�कीओरसे/Respondent by : Smt. Priyanka Dhar (Addl. CIT) – Ld. Sr. DR सुनवाईकीतारीख/Date of Hearing : 04-08-2025 घोषणाकीतारीख /Date of Pronouncement : 18-08-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2017-18 arises out of an order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 16-01-2025 in the matter of an assessment framed by Ld. Assessing Officer [AO] on best judgment basis u/s. 144 of the Act on 28-10-2019. It could be seen that the case of the assessee was scrutinized to verify sources of cash deposit of Rs.21.09 Lacs. In the absence of any submissions as forthcoming from the assessee, Ld. AO considered the deposits as well as interest income as the income of the assessee and made assessment of Rs.23.97 Lacs 2. During first appeal, it transpired that the assessee acted as a small-time vendor of snacks and earned business income. She also stated that deposits of Rs.21.68 Lacs were sourced out of sale of certain property. However, in the absence of any acceptable evidences, Ld. CIT(A) confirmed the assessment against which the assessee is in further appeal before us.

3.

The Ld. AR has placed on record cash flow of the assessee as under: - No. Nature of Source of Cash Amount Received 1. Cash received on sale of properties during FY 2015-16 Rs.14.25 Lacs 2. Cash received on sale of properties during FY 2016-17 Rs.7.43 Lacs 3. Re-deposit of cash withdrawn Rs.3.00 Lacs 4. Business Receipts in cash Rs.9.63 Lacs Total Rs.34.31 Lacs The Ld. AR has also placed on record cash book of the assessee for FY 2016-17 and 2015-16 to demonstrate that the assessee had sufficient cash balance to make the impugned deposits. The Ld. AR has also placed on record computation of income of the assessee. Upon perusal of the same, it could be seen that the assessee has suffered Long Term Capital Loss of Rs.5.06 Lacs on sale of properties listed at serial nos. 1 & 2. The assessee has computed business income of Rs.1.25 Lacs on business receipts of Rs.15.14 Lacs which translate into profit rate of more than 8%. The other source of income for the assessee is interest income which aggregate to Rs.3.77 Lacs.

The total income is thus computed at Rs.4.92 Lacs after deduction u/s 80TTA for Rs.0.10 Lacs. Upon perusal of the same, it would appear that the assessee has successfully discharged the onus of establishing the sources of cash deposits. Accordingly, the impugned order is set- aside and Ld. AO is directed to accept this computation of income after due verification thereof. The impugned addition of Rs.21.09 Lacs of cash deposits as made by Ld. AO stand deleted. The Ld. AO is also directed to re-compute the income of the assessee accordingly. The assessee is directed to plead and prove its computation of income.

4.

The appeal stand allowed for statistical purposes. Order pronounced on 18-08-2025 Sd/- Sd/- (LALIET KUMAR) (MANOJ KUMAR AGGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 18-08-2025. आदेश की �ितिलिप अ�ेिषत /Copy of the Order forwarded to : 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकरआयु�/CIT 4. िवभागीय�ितिनिध/DR 5. गाड�फाईल/GF ASSISTANT REGISTRAR

ITAT CHANDIGARH

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