MAJOR SINGH,KAITHAL vs. ITO, WARD-1, KAITHAL

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ITA 138/CHANDI/2024Status: DisposedITAT Chandigarh12 March 2025AY 2012-13Bench: Shri RAJPAL YADAV, VICE PRESIDENT, 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 cash deposits were substantiated by the payment made to Idea Cellular Ltd. and were supported by Form 26AS, which showed commission income with TDS. Therefore, the deposits could not be considered income from undisclosed sources.

What were the facts?

The assessee's appeal was against the CIT(A)'s order confirming an addition of Rs.40.32 Lacs, representing cash deposits in the assessee's bank account, treated as income from undisclosed sources by the AO. The assessee claimed these deposits were sale proceeds from selling recharge coupons, which were used to pay Idea Cellular Ltd.

What were the issues?

Whether cash deposits in a bank account, claimed to be business receipts and used for business payments, can be treated as income from undisclosed sources when supported by Form 26AS and payment details, despite initial non-consideration by the AO.

Which sections of the Income-tax Act were involved?

Section 144,Section 147,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, CHANDIGARH

Before: HON’BLE Shri RAJPAL YADAV, & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

(िनधा�रणवष� / Assessment Year: 2012-13) Shri Major Singh S/o Shri Gasitu Ram ITO- Ward 1 बनाम/ Village Malikpur, Tehsil Siswan Kaithal-136027. Vs. Kaithal-136027 Haryana. �थायीलेखासं./जीआइआरसं./PAN/GIR No. CCVPS-1180-E (अपीलाथ�/Appellant) : (��थ� / Respondent) अपीलाथ�कीओरसे/ Appellant by : Shri Pranav Jain (Advocate) – Ld. AR ��थ�कीओरसे/Respondent by : Dr. Ranjeet Kaur – Ld. Sr. DR सुनवाईकीतारीख/Date of Hearing : 04-03-2025 घोषणाकीतारीख /Date of Pronouncement : 12-03-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2012-13 arises out of an order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 20-11-2023 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 144 r.w.s. 147 of the Act on 29-11-2019. The sole grievance of the assessee is confirmation of addition of cash deposit for Rs.40.32 Lacs. Having heard rival submissions and upon perusal of case records, the appeal is disposed-off as under. The registry has noted delay of 27 days which stand condoned.

2.

In the assessment order, it was observed by Ld. AO that the assessee made cash deposits in its bank account as maintained with SBI, Siwan branch. Accordingly, the assessee was directed to substantiate the sources thereof. In the absence of any explanation as forthcoming from the assessee, Ld. AO treated the said deposits as income from undisclosed sources and framed the assessment on best judgment basis.

3. During appellate proceedings, the assessee stated that it was engaged in selling recharge coupons of IDEA company on which he was getting commission. The said deposits were nothing but sale proceeds of business activities. The same were subjected to remand proceedings wherein Ld. AO stated that the assessee failed to file any agreement to prove the same. Accordingly, Ld. CIT(A) confirmed the assessment against which the assessee is in further appeal before us.

3.

The perusal of bank statement, as placed on record, would show that substantial cash deposits have been utilized by the assessee to make the payment to Idea Cellular Ltd. The summary of payment so made by the assessee to Idea Cellular Ltd. has been placed on Page Nos. 21 to 23 of the paper book. It could be seen that the assessee has paid aggregate payment of Rs.34.93 Lacs to Idea Cellular Ltd. A perusal of Form 26AS as placed on Page Nos. 28 to 32 would confirm that the assessee has earned commission income on which TDS has been deducted by the payer. All these facts substantiate the claim of the assessee. The assessee has filed regular return of income on 12- 02-2013 declaring business income of Rs.2.01 Lacs wherein the assessee has taken into account the aforesaid commission receipts. The Ld. AO has not considered the same. On these facts, it could very well be concluded that the aforesaid receipts could not be held to be income from undisclosed sources from any angle. Therefore, we delete the impugned addition. No other ground has been urged in the appeal.

4.

The appeal stand allowed in terms of our above order. Order pronounced on 12-03-2025.

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