SH. RAMESH CHAND,YAMUNA NAGAR vs. ITO, WARD-3, YAMUNA NAGAR

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ITA 280/CHANDI/2023Status: DisposedITAT Chandigarh09 June 2025AY 2011-12Bench: SHRI LALIET KUMAR (Judicial Member), SHRI MANOJ KUMAR AGGARWAL (Accountant Member)1 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 held that the additions made by the AO were unsustainable on facts, as the assessee provided evidence of the source of deposits from retirement benefits and earlier withdrawals.

What were the facts?

The assessee failed to represent during assessment proceedings, leading the AO to make additions on a best judgment basis. The assessee claimed these deposits were from retirement benefits and earlier withdrawals, supported by bank statements and a retirement certificate.

What were the issues?

Whether the additions made by the AO on a best judgment basis were justified, considering the evidence provided by the assessee regarding the source of deposits.

Which sections of the Income-tax Act were involved?

Section 144,Section 143(3),Section 147

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: 2011-12) Shri Ramesh Chand ITO 1600/A Prahladpuri बनाम/ Vs. Sector 17 Yamunanagar-135001. HUDA Jagadhri-135003 �थायीलेखासं./जीआइआरसं./PAN/GIR No.ADQPC-3573-P (अपीलाथ�/Appellant) : (��थ� / Respondent) अपीलाथ�कीओरसे/ Appellant by : None ��थ�कीओरसे/Respondent by : Dr Ranjit Kaur (Addl. CIT) – Ld. Sr. DR सुनवाईकीतारीख/Date of Hearing : 04-06-2025 घोषणाकीतारीख /Date of Pronouncement : 09-06-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2011-12 arises out of an order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Central (NFAC), Delhi [CIT(A)] dated 06-03-2023 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 144 r.w.s.143(3) / 147 of the Act on 17-12- 2018. The assessee failed to make any representation during assessment proceedings and accordingly, Ld. AO assessed income on best judgment basis at Rs.15.92 Lacs. The assessee declared income of Rs.1.56 Lacs. The assessee deposited cash of Rs.13.87 Lacs in his bank accounts which was held to be from unexplained sources. The assessee earned bank interest of Rs.0.41 Lacs which was also added to the income of the assessee. Though the assessee contested the assessment in first appeal, Ld. CIT(A) dismissed the appeal of the assessee against which the assessee is in further appeal before us.

2.

Form the records, it emerges that the assessee has retired from service on 31-05-2010 at the age of 58 years. The assessee has received cash in lieu of unutilized earned leave at the time of retirement which was deposited in his bank account. The requisite document, in this regard, has been placed on record. The assessee has also placed on record cash flow statement of Oriental Bank of Commerce which would show that the impugned deposits have been sourced out of earlier withdrawals. Similarly, the deposits in SBI are backed by earlier withdrawals. The cash withdrawals from SBI are for Rs.5.17 Lacs whereas deposits are for Rs.2 Lacs only. Similarly, withdrawals from OBC are Rs.15.73 Lacs as against deposit of Rs.11.87 Lacs. Further, the assessee has earned bank interest of Rs.6,615/- as against Rs.41,469/- as considered by Ld. AO. The same is evident from the certificate of the bank as placed on record. On these facts, both the additions as made by Ld. AO are unsustainable on facts. Accordingly, we direct Ld. AO to accept the returned income of the assessee.

3.

The appeal stand allowed. Order pronounced on 09-06-2025.

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