DHWANI JAYESHKUMAR PATEL,PANCHMAHAL vs. THE ITO, WARD-4(1)(2), VADODARA

The present appeal has been preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘CIT(A)’] dated 25/07/2025 passed u/s.250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for the Assessment Year (AY) 2017-2018.

In this appeal, the assessee is aggrieved by the action of the Ld. CIT(A) in confirming the addition made by the Assessing Officer (AO) of Dhwani Jayeshkumar Patel vs. The ITO Asst4.Year : 2017-18 Rs.31,28,66,130/- on account of unexplained cash credits in the bank account of the assessee.

The brief facts of the case the AO on verification of bank accounts of the assessee found that huge cash of Rs.23,47,41,361/- was deposited in the said bank accounts during the year. He asked the assessee to submit the source of the aforesaid cash deposits in his bank accounts. The assessee explained that the assessee was engaged in the business of discounting and commission carried out in the name of Jay Finance. That the assessee was resident of Halol, Gujarat which was a plastic products manufacturing hub. It was explained that the various business men from all over India come to purchase plastic products at Halol and the transactions were mostly carried out in cash. That those persons belonging to various places deposited different amounts in the bank account of the assessee and collected the same in cash from the assessee at Halol or the assessee could pay the amount to the beneficiaries as instructed by them, for which the assessee got commission. The assessee duly offered the commission income for taxation. The AO asked the assessee to furnish the names, addresses, PAN, ledger, confirmation, etc. of the said parties. The AO noted that the assessee had not furnished the details of all the parties. That even there were incomplete addresses of the persons. The AO, however, issued notices u/s 133(6) of the Act and summons u/s 131 of the Act to those persons whose addresses seem to be complete. The AO noted that notices u/s 133(6) of the Act were issued in 10 cases out of which 8 notices received back with Postal remarks “insufficient address”. Further, summons u/s 131 of the Act were issued to 8 persons, the same were also returned back “unserved”. The AO, therefore, issued show- cause notice to the assessee as to why the said amount of Rs.23,47,41,361/- be Dhwani Jayeshkumar Patel vs. The ITO Asst4.Year : 2017-18 not added to the income of the assessee. In response to the show-cause notice, the assessee submitted that the assessee had acted only as a commission agent and that the money deposited in the bank account of the assessee belonged to different persons. That all the transactions were recorded in his books of accounts. That the assessee had also obtained registration certificate for carrying out such activities from the competent authority, i.e.