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Facts
The assessee failed to file a return of income for the assessment year 2017-18. The Assessing Officer (AO) reopened the assessment under Section 147/144 of the Income Tax Act, 1961, after information revealed a cash deposit of Rs. 15,15,000/- in the assessee's bank account during the demonetization period. The assessee did not comply with notices issued during the reassessment proceedings.
Held
The assessee failed to provide any explanation or supporting documents for the cash deposit and other credits amounting to Rs. 1,17,98,862/-. The Assessing Officer completed the assessment under Section 147 read with Section 144 of the Act. The CIT(A) dismissed the appeal for non-compliance and lack of evidence. The Tribunal upheld the CIT(A)'s order, finding no infirmity.
Key Issues
Whether the CIT(A) erred in sustaining the addition made by the AO for undisclosed income, given the assessee's failure to provide any explanation or evidence for cash deposits and other credits, and non-compliance with notices.
Sections Cited
144, 69A, 80TTA, 10,000, 148, 147, 139, 142(1), 250, 34(4)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, SURAT BENCH “DB” SURAT
Before: SHRI SANDEEP GOSAIN & SHRI OM PRAKASH KANT
ORDER PER OM PRAKASH KANT, AM
This appeal by the assessee is directed against the order, dated 27.05.2024, passed by the Ld. Commissioner of Income-tax (Appeals) – National Faceless Appeal Centre, Delhi [in short, “the Ld. CIT(A)”] for the Assessment Year 2017–18, raising grounds as reproduced below:
The Assessment Order passed u/s 144 of the I.T. Act dated 12- 10-2019 is bad in law and liable to be quashed and Ld. CIT(A) has erred in law in holding the same as valid.
2. Ld. CIT(A) (NFAC) has erred in sustaining the addition made by the AO of Rs. 1,17,98,862/- u/s. 69A of the Income Tax Act, 1961.
Ld. CIT(A) (NFAC) has erred in sustaining the Ld. CIT(A) (NFAC) has erred in sustaining the addition made by the addition made by the AO of Rs. 2,261/ AO of Rs. 2,261/- after allowing deduction under section after allowing deduction under section 80TTA of Rs. Rs. 10,000/ 10,000/- as as undisclosed undisclosed interest interest income income under under the the Income Tax Act, Act, 1961.
Despite notifying for hearing Despite notifying for hearing, neither anyone attended nor neither anyone attended nor any application for adjournmen any application for adjournment was filed before us and t was filed before us and therefore, we were of the opinion that the assessee is not therefore, we were of the opinion that the assessee is not therefore, we were of the opinion that the assessee is not interested in prosecuting the appeal, hence same was heard ex interested in prosecuting the appeal, hence same was heard ex interested in prosecuting the appeal, hence same was heard ex- parte parte parte qua qua qua the the the assessee assessee assessee after after after hearing hearing hearing arguments arguments arguments of of of ld ld ld Departmental Representative. Departmental Representative.
In the case, the Assess In the case, the Assessee did not file regular return of ee did not file regular return of income for the year under consideration, subsequently the income for the year under consideration, subsequently the income for the year under consideration, subsequently the Assessing Officer from the Information collected by the Income Assessing Officer from the Information collected by the Income Assessing Officer from the Information collected by the Income Tax Department noticed that Assessee had deposited cash of Rs Tax Department noticed that Assessee had deposited cash of Rs Tax Department noticed that Assessee had deposited cash of Rs 15,15,000/- in his bank account during in his bank account during demonetization period, demonetization period, he reopened the Assessment and issued notice u/s 148 of the he reopened the Assessment and issued notice u/s 148 of the he reopened the Assessment and issued notice u/s 148 of the Income Tax Act, 1961 (‘the Act’). On 31 Income Tax Act, 1961 (‘the Act’). On 31st March 2018, no March 2018, no compliance of the same was made on the part of the Assessee. compliance of the same was made on the part of the Assessee. compliance of the same was made on the part of the Assessee. Subsequently, the Assessing Officer issued further noti Subsequently, the Assessing Officer issued further noti Subsequently, the Assessing Officer issued further notices during the course of the Reassessment Proceedings but the same also the course of the Reassessment Proceedings but the same also the course of the Reassessment Proceedings but the same also remained non-complied. complied. complied. Therefore, Therefore, Therefore, the the the Assessing Assessing Assessing Officer Officer Officer completed the Assessment as Best Judgement Assessment completed the Assessment as Best Judgement Assessment completed the Assessment as Best Judgement Assessment invoking Section 147 r/w Section 144 on 12 invoking Section 147 r/w Section 144 on 12th October 2019 October 2019 determining total income at Rs 1,18,01,120/ l income at Rs 1,18,01,120/-.
On further appeal, before the learned CIT(A), no compliance On further appeal, before the learned CIT(A), no compliance On further appeal, before the learned CIT(A), no compliance was made by the Assessee of the various notices issued u/s 250 was made by the Assessee of the various notices issued u/s 250 was made by the Assessee of the various notices issued u/s 250 of the Act. Therefore, the learned CIT(A) dismissed the Appeal of of the Act. Therefore, the learned CIT(A) dismissed the Appeal of of the Act. Therefore, the learned CIT(A) dismissed the Appeal of the Assessee observing as under the Assessee observing as under:
“3.4. I have perused the grounds of appeal, statement of facts 3.4. I have perused the grounds of appeal, statement of facts 3.4. I have perused the grounds of appeal, statement of facts and the assessment order. The assessee has not produced any and the assessment order. The assessee has not produced any and the assessment order. The assessee has not produced any material, document or evidence, which he could rely upon, to material, document or evidence, which he could rely upon, to material, document or evidence, which he could rely upon, to controvert the finding of the AO. It is seen that the assessee has controvert the finding of the AO. It is seen that the assessee has controvert the finding of the AO. It is seen that the assessee has not filed any return for the relevant assessment year u/s 139 of iled any return for the relevant assessment year u/s 139 of iled any return for the relevant assessment year u/s 139 of the I.T. Act, 1961 whereas, there was an information in the the I.T. Act, 1961 whereas, there was an information in the the I.T. Act, 1961 whereas, there was an information in the possession of the department that the assessee had cash possession of the department that the assessee had cash possession of the department that the assessee had cash deposited during the demonetization period Rs. 15,15,000/ deposited during the demonetization period Rs. 15,15,000/ deposited during the demonetization period Rs. 15,15,000/- in his savings bank a his savings bank account. Accordingly, the case of the assessee ccount. Accordingly, the case of the assessee was reopened for reassessment u/s 147 of the Act after was reopened for reassessment u/s 147 of the Act after was reopened for reassessment u/s 147 of the Act after following the due procedure laid down in the I.T. Act and notice following the due procedure laid down in the I.T. Act and notice following the due procedure laid down in the I.T. Act and notice u/s 142(1) was issued on 23.08.2018. But, the assessee nither u/s 142(1) was issued on 23.08.2018. But, the assessee nither u/s 142(1) was issued on 23.08.2018. But, the assessee nither filed the return of income n filed the return of income nor furnished any reply in response to or furnished any reply in response to notice u/s 142(1) dated 23.02.2018. Before that notices u/s notice u/s 142(1) dated 23.02.2018. Before that notices u/s notice u/s 142(1) dated 23.02.2018. Before that notices u/s 142(1) were issued on 10.06.2019, 17.08.2019 & 31.08.2019 142(1) were issued on 10.06.2019, 17.08.2019 & 31.08.2019 142(1) were issued on 10.06.2019, 17.08.2019 & 31.08.2019 asking for his clarification / explanation along with supporting asking for his clarification / explanation along with supporting asking for his clarification / explanation along with supporting material, documents, in respect of material, documents, in respect of the cash deposit of Rs. the cash deposit of Rs. 15,15,000/- in savings bank account during the demonetization in savings bank account during the demonetization in savings bank account during the demonetization period. However, the assessee had not furnished any period. However, the assessee had not furnished any period. However, the assessee had not furnished any information / details. Thereafter the AO issued show cause information / details. Thereafter the AO issued show cause information / details. Thereafter the AO issued show cause notice on 20.09.2019. But, the assessee neither filed any r notice on 20.09.2019. But, the assessee neither filed any r notice on 20.09.2019. But, the assessee neither filed any reply in response to the show cause notice issued nor sought any in response to the show cause notice issued nor sought any in response to the show cause notice issued nor sought any adjournment this time also. adjournment this time also. 3.5 On merit assessment order appears to be reasonable and 3.5 On merit assessment order appears to be reasonable and 3.5 On merit assessment order appears to be reasonable and as per law. As per settled position of law the onus lied upon the as per law. As per settled position of law the onus lied upon the as per law. As per settled position of law the onus lied upon the appellant to explain the source of cash appellant to explain the source of cash deposit and credits in deposit and credits in bank account with supporting material and evidence. It was the bank account with supporting material and evidence. It was the bank account with supporting material and evidence. It was the duty of the appellant to explain the issues on which queries duty of the appellant to explain the issues on which queries duty of the appellant to explain the issues on which queries were raised by the AO. Mere statement of the fact, during the were raised by the AO. Mere statement of the fact, during the were raised by the AO. Mere statement of the fact, during the appeal stage, that the appellant is a farmer a appeal stage, that the appellant is a farmer and does not have nd does not have any taxable income, the address of the appellant had changed any taxable income, the address of the appellant had changed any taxable income, the address of the appellant had changed and not aware about the assessment proceedings, without any and not aware about the assessment proceedings, without any and not aware about the assessment proceedings, without any evidence to corroborate his plea, did not make the assessee free evidence to corroborate his plea, did not make the assessee free evidence to corroborate his plea, did not make the assessee free from legal obligation being discharged during assessm from legal obligation being discharged during assessm from legal obligation being discharged during assessment. The onus was not discharged by the appellant to the satisfaction of onus was not discharged by the appellant to the satisfaction of onus was not discharged by the appellant to the satisfaction of the AO. Source of credits of Rs.1,17,98,862/ the AO. Source of credits of Rs.1,17,98,862/- (include cash (include cash deposit during the demonetization period) were not explained deposit during the demonetization period) were not explained deposit during the demonetization period) were not explained with supporting material/ documents, during assessment with supporting material/ documents, during assessment with supporting material/ documents, during assessment proceeding despite opportunities been provided at the stage of ing despite opportunities been provided at the stage of ing despite opportunities been provided at the stage of assessment. During appeal proceeding, no explanation in assessment. During appeal proceeding, no explanation in assessment. During appeal proceeding, no explanation in respect of the disputed issue was provided, as well. From the respect of the disputed issue was provided, as well. From the respect of the disputed issue was provided, as well. From the above conduct of the assessee, it becomes quite clear that the above conduct of the assessee, it becomes quite clear that the above conduct of the assessee, it becomes quite clear that the assessee is not int assessee is not interested in prosecuting its appeal. In the erested in prosecuting its appeal. In the event, I have no reason to interfere with the findings of the AO. event, I have no reason to interfere with the findings of the AO. event, I have no reason to interfere with the findings of the AO. In such circumstance, I dismiss the claim of In such circumstance, I dismiss the claim of the appellant. appellant.”
5. Before us also, Before us also, no submission or evidence in support of the no submission or evidence in support of the claim claim justifying justifying source source of of deposit deposit of of cash cash during during the the demonetization period has been filed by the Assessee and demonetization period has been filed by the Assessee and demonetization period has been filed by the Assessee and therefore we do not find any infirmity in the order of the learned therefore we do not find any infirmity in the order of the learned therefore we do not find any infirmity in the order of the learned CIT(A) on the issue in dispute and therefore we uphold the CIT(A) on the issue in dispute and therefore we uphold the CIT(A) on the issue in dispute and therefore we uphold the finding of the learned CIT(A) on the merits finding of the learned CIT(A) on the merits of the case. of the case.
5.1 Grounds Grounds Grounds of of of Appeal Appeal Appeal of of of the the the Assessee Assessee Assessee are are are dismissed dismissed dismissed accordingly.
In the result, the Appeal of the Assessee is dismissed. In the result, the Appeal of the Assessee is dismissed. In the result, the Appeal of the Assessee is dismissed.
Order pronounced by way display o Order pronounced by way display of result on notice f result on notice board on 30/10/2025 under Rule 34(4) of ITAT Rules, 1963. /10/2025 under Rule 34(4) of ITAT Rules, 1963. /10/2025 under Rule 34(4) of ITAT Rules, 1963. Sd/- Sd/ Sd/- (SANDEEP GOSAIN (SANDEEP GOSAIN) (OM PRAKASH KANT OM PRAKASH KANT) JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER