RAVINDRA PRATAPRAI DOSHI,MUMBAI vs. INCOME TAX OFFICER 29(3)(1), MUMBAI

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ITA 19/MUM/2018Status: DisposedITAT Mumbai04 September 2019AY 2013-144 pages

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

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that unexplained cash deposits in bank accounts are liable to be added as income from undisclosed sources, especially when the assessee had previously accepted such deposits as undisclosed income.

What were the facts?

During a survey, the assessee admitted to unexplained cash deposits in his savings account and proprietorship concerns. The assessee failed to provide explanations for these deposits during assessment and appellate proceedings.

What were the issues?

Whether unexplained cash deposits in bank accounts can be added as income from undisclosed sources. Whether the assessee's failure to provide explanations validates the addition.

Which sections of the Income-tax Act were involved?

Section 68,Section 69,Section 69B,Section 133A,Section 131

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, “D” Bench, Mumbai

Before: Shri Shamim Yahya (AM) & Shri Ravish Sood (JM)

For Respondent: Shri D.G. Pansari
Hearing: 19.6.2019Pronounced: 04.9.2019

Heard together (2 matters)

I.T.A. No. 19/Mum/2018
I.T.A. No. 145/Mum/2018

Read from the judgment's own cause title. This page is filed under one of them.

O R D E R Per Shamim Yahya (AM) :-

These are appeals by the assessee against respective order of learned CIT-A and pertaining to assessment years 2010-11 & 2013-14.

2.

The grounds of appeal for A.Y. 2013-14 read as under :-

On the facts and in the circumstances of the case and in law, the Commissioner of Income Tax - Appeals 40, Mumbai, hereinafter referred to as the Ld. CIT (A) has erred in law in confirming the addition of Rs.53,27,059/ in respect of unexplained cash credit u/s.69/69B of the Income Tax Act, 1961. The said addition may please be deleted.

3.

Grounds of appeal for A.Y. 2010-11 read as under :-

On the facts and in the circumstances of the case and in law, the Commissioner of Income Tax - Appeals 40, Mumbai, hereinafter referred to as the Ld. CIT (A) has erred in law in confirming the addition of Rs.1,67,42,690/- in respect of unexplained cash credit u/s.69/69B of the Income Tax Act, 1961. The said addition may please be deleted. On the facts and in the circumstances of the case and in law, The Ld. CIT (A) has erred in confirming the addition of Rs. 14,470/- on account of Short Term Capital Gain. The said addition may please be deleted.

2 Shri Ravindra Prataprai Doshi

4.

Brief facts of the case are as under :- (A.Y. 2013-14)

A survey u/s. 133 of the Act was conducted at the residential premises of the assessee on 19.10.2013 during which the assessee admitted that he was maintaining S/B A/c No. 021201200035 in Cosmos Co-operative Bank Ltd., Zaveri Bazar Branch. Amount of cash deposited in this S/B A/c during the previous year under consideration was Rs. 18,59,678/-. Since the assessee was not able in explain the nature and source of this cash deposit in the savings account, he admitted the same to be his income from undisclosed sources, in the statement recorded under section 131 of the IT Act on 21/10/2013 and 23/10/2013 in the Income Tax Office at Matru Mandir, Tardeo Road, Mumbai. It was also found during the course of survey that the assessee was proprietor of M/s R P Trading Co, Montex Enterprises and M/s Doshi Trading Co. All these proprietorship concerns were having bank account in Cosmos Co-operative Bank Ltd, Zaveri Bazar Branch and there were a number of transactions in these bank accounts. The assessee was also found to be a director in following 5 Pvt. Ltd. Companies Rich Trading Pvt. Ltd. Gallup Trading Pvt. Ltd. Rapar Trading Pvt. Ltd. Avneel Tradinn Pvt. Ltd. and Trendz Trading Pvt. Ltd.

4. Since the assessee did not file the return of income for the A.Y. under consideration, notice under section 142 of the IT Act was issued to the assessee on 25/02/2014 calling for the return of income. The assessee did not comply with the notice issued on 25/02/2014. The return of income was filed by the assessee only on 13/03/2015 declaring total income at Rs. 1,97,703/-. The case was selected for scrutiny and the notice u/s 143(2) of the IT Act was issued to the assessee on 27/03/2015. Subsequently, notice under section 142(1) IT Act was issued to the assessee on 07/01/2016 calling for certain information. However, he did not reply to notice u/s 142(1) of the IT Act. AIR data of the assessee showed that the case was deposited by the assessee 42 times during the relevant previous year and total cash deposited was Rs.

3 Shri Ravindra Prataprai Doshi 53,29,356/-. This included the cash of Rs. 18,59,678/- deposited by the assessee in his savings account. In absence of any explanation from the assessee, entire amount of cash deposit i.e. Rs. 53,29,356/- was added in the hands of the assessee as unexplained cash credit u/s. 68 of the I.T. Act.

5.

Upon assessee's appeal learned CIT(A)noted that nobody appeared on behalf of the assessee despite notice. Learned CIT confirmed the addition by holding as under :- As mentioned above, the appellant has not furnished any explanation regarding the source and the nature of deposits amounting to Rs.53,29,356/- in his Bank Accounts during the course of assessment proceedings. The appellant has not given any explanation during the course of appellate proceedings either. Therefore, in absence of any explanation regarding source and nature of the deposits in his Bank accounts with the Cosmos Co-operative Bank, there is no option before the undersigned but to confirm the addition made by the AO. It is not clear whether the appellant has maintained any books of accounts or not. In case, books of account are being maintained by the appellant, the amount is taxable under section 68 of the IT Act, however, in case no books of accounts are maintained by the appellant, the amount is taxable under section 69/69B of the IT Act as held by the Special Bench of ITAT, New Delhi in the case of Manoj Aggarwal Vs DCIT [2008] 113 ITD 377 (DELHF) (SB). Accordingly, the first ground of appeal is dismissed and addition of Rs. 53,29,3567- made by the AO is confirmed.

6.

For A.Y. 2010-11, for unexplained cash deposit the Assessing Officer has also noted that assessee in statement u/s. 133A has accepted to be his undisclosed income.

7.

Against these orders assessee is in appeal before us. We have heard the learned departmental representative and perused the records. None appeared on behalf of the assessee despite notice.

8.

We find that the addition in this case has been done as there are unexplained cash deposits in the bank of the assessee. Assessee has not provided any detail regarding the source through which this cash was generated and deposited in the bank account. As a matter of fact for A.Y. 2010-11 assessee has accepted it to be undisclosed income. In this viww of the matter in our considered opinion the unexplained cash deposit in the bank of 4 Shri Ravindra Prataprai Doshi the assessee is liable to be added in the hands of the assessee as income from undisclosed source. Hence we do not find any infirmity in the order of learned CIT(A). Hence we uphold the same.

9.

In the result this appeal by the assessee stands dismissed Order has been pronounced in the Court on 4.9.2019.

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