DEEPAK KARANI,HOWRAH vs. D.C.I.T.,CIRCLE-47, KOLKATA

The assessee in the present case is an individual, who filed his return of income for the year under consideration on 02.02.2013 declaring total income of Rs.2,00,940/-. As per the information received by the Assessing Officer, the assessee was a proprietor of two concerns namely M/s. Finwise Services and M/s. Vision Enterprises and the cash Assessment Year: 2012-2013 Deepak Karani deposits of Rs.2,33,970/- were made during the year under consideration in the Bank account maintained in the name of M/s. Finwise Services with ICICI Bank. Since the said Bank account was not disclosed by the assessee in the return of income filed for the year under consideration, the assessment was reopened by the Assessing Officer and the notice under section 148 was issued by him to the assessee on 29.03.2017. In reply, it was submitted on behalf of the assessee that the return originally filed by him on 02.02.2013 may be treated as the return filed in response to the notice under section 148. During the course of assessment proceedings, the assessee denied of having any relation with the two proprietary concerns namely M/s. Finwise Services and M/s. Vision Enterprises. This stand of the assessee was not found acceptable by the Assessing Officer in the absence of any credible evidence and keeping in view that no explanation was offered by the assessee in respect of cash deposits of Rs.2,33,970/- found to be made in the Bank account of M/s. Finwise Services maintained with ICICI Bank, he added the said amount to the total income of the assessee by treating the same as unexplained in the assessment completed under section 143(3)/147 of the Act vide an order dated 29.12.2017.

Against the order passed by the Assessing Officer under section 143(3)/147, an appeal was preferred by the assessee before the ld. CIT(Appeals) challenging the addition of Rs.2,33,970/- made by the Assessing Officer on account of cash deposits found to be made in the Bank account of M/s. Finwise Services maintained with ICICI Bank and the following submission, inter alia, was made on behalf of the assessee in support of his case on this issue:- “Ground no. 1 relates to the error made by AO in making additions of cash deposit of Rs.2,33,970 allegedly made in ICICI Bank account of M/s Finwise services which does not belong to the appellant. The appellant fully denied during the course of income tax assessment proceeding for the said A. Y. 2012-13 but AO did not consider and pay any heed to the contentions of Appellant. But in an Assessment Year: 2012-2013 Deepak Karani

The ld. CIT(Appeals) did not find merit in the submission of the assessee and proceeded to confirm the addition of Rs.2,33,970/- made by the Assessing Officer for the reasons given in paragraph no. 3.3 of his impugned order:- “3.3. I have gone through and perused the relevant assessment records. The appellant during both assessment and appeal proceeding had vehemently denied that the bank account bearing No.090105500015 with ICIC Bank Kolkata belong to him. He had also submitted that unknown persons had forged and miss-utilized his PAN card for opening of said account. The A.O. in the assessment order had noted that during the financial year 2011-12 a sum of Rs.2,33,970/- was deposited in the account. However, the A.O. had not accepted the contention of the appellant that the bank account did not belong to him as he could not provide any credible evidence to the contrary. During the appeal proceedings, the A/R of the appellant could also provide no conclusive evidence that the bank account did not belong to him. It may be noted that till date of hearing on 12.03.2019, the appellant had not filed FIR with the Police Department regarding forgery committed by unknown persons who had opened bank account by misusing his PAN card. This is indeed surprising as any normal person would have file FIR with the Police Department, if his PAN card has being fraudulently use for opening bank account. It appears that the explanation given by the appellant was just a cover up in order to avoid tax Assessment Year: 2012-2013 Deepak Karani

I have heard the arguments of both the sides and also perused the relevant material available on record. It is observed that the addition of Rs.2,33,970/- made by the Assessing Officer by treating the cash deposits found to be made in the bank account of M/s. Finwise Services maintained with ICICI Bank was confirmed by the ld. CIT(Appeals) mainly on the ground that the claim of the assessee of having no relation whatsoever with M/s. Finwise Services was not supported by any evidence in the form of an FIR filed by the assessee with the Police Department regarding forgery committed by unknown persons, who had allegedly opened the concerned Bank account by misusing the PAN Card of the assessee. In this regard, ld. Counsel for the assessee has submitted that such FIR was indeed filed by the assessee with Nischinda Police Station on 19.03.2019 but the ld. CIT(Appeals) could not take cognizance of the same as the impugned order was passed by him on 12.03.2019 itself. He has submitted that the assessee has also filed a complaint with the RBI Ombudsman Grievance Cell since no action was taken by the concerned Police Station in the matter till 24.10.2019. He has invited attention to the copies of these two complaints placed in his paper book and submitted that neither Assessing Officer nor the ld. CIT(Appeals) having got an opportunity to examine this evidence which supports and substantiates the claim of the assessee, the matter may be sent back to the Assessing Officer for fresh consideration. He has further submitted that the Assessing Officer may make further inquiry in the matter including getting the forensic report, if required, to verify the claim of the assessee that he was not the proprietor of M/s. Finwise Services and the Bank account in the name of the said concern was opened with ICICI Assessment Year: 2012-2013 Deepak Karani Bank by someone else by forging the PAN Card and signature of the assessee.

Having considered all the facts and circumstances of the case, I am inclined to accept the contention of the ld. Counsel for the assessee and since the ld. D.R. has also not raised any objection for sending the matter back to the Assessing Officer for proper verification, I set aside the impugned order of the ld. CIT(Appeals) on this issue and restore the matter to the file of the Assessing Officer for fresh consideration with a direction to verify the claim of the assessee in the light of the evidence brought on record in the form of complaints filed with the concerned Police Station as well as RBI. The Assessing Officer shall cause any further inquiry as he may deem fit in the facts and circumstances of the case.

In the result, the appeal filed by the assessee is treated as allowed for statistical purposes. Order pronounced in the open Court on March 08, 2021.