Loading judgment…
Facts
The assessee filed a return for A.Y. 2017-18 declaring Rs. 2,42,111/-. During scrutiny, the AO found unexplained cash deposits of Rs. 2,00,000/- in the bank account for F.Y. 2016-17 and made an addition under Section 69A, assessing the total income at Rs. 5,05,110/-. The CIT(A) confirmed this addition, prompting the assessee's appeal to the Tribunal.
Held
The Tribunal noted the assessee had an opening cash balance of Rs. 1,42,000/- as of 01.04.2016, and the A.Y. 2016-17 assessment was completed under Section 143(3). Considering the explained sources like opening cash balance, earnings from stitching classes, and past savings, the Tribunal found the cash deposits adequately supported. Consequently, the Tribunal set aside the CIT(A)'s order and directed the Assessing Officer to delete the addition under Section 69A.
Key Issues
Whether the addition made by the Assessing Officer under Section 69A for unexplained cash deposits was justified, despite the assessee's explanation regarding the source of funds from opening cash balance, earnings, and past savings.
Sections Cited
143(3), 250, 69A, 142(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PANAJI BENCH
Before: SHRI PAVAN KUMAR GADALE & SHRI G D PADMAHSHALI
सुनवाई क� तार�ख/Date of Hearing 01.04.2025 घोषणा क� तार�ख/Date of Pronouncement 02.04.2025 ORDER
PER PAVAN KUMAR GADALE, JM:
The appeal is filed by the assesse against the order of Addl/JCIT(A) prayagraj passed u/sec143(3) and u/sec 250 of the Act. The assessee has raised the grounds of appeal challenging the order of the CIT(A) sustaining the addition u/se 69Aof the Act by the Assessing Officer.
2. The brief facts of the case are that, the assesse has filed the return of income for A.Y.2017-18 on 6.07.2017 disclosing a total income of Rs.2,42,111/-. The case was Seeta Ramachandra Chhappar. Belagavi. selected for limited scrutiny under the CASS. The Assessing Officer (AO) based on the information from ITBA data found that, the assesse has made cash deposits in the bank account aggregating to Rs.2,00,000/- in the F.Y.2016-17 and the notice u/sec142(1) of the Act was issued to furnish the details and sources of cash deposits. The assessee has filed the explanations and details mentioning the sources of investments and income earned over the years disclosed in the statement of affairs dealt at Para4 of the order. Whereas the A.O was not satisfied with the explanations and dealt on the provisions of the Act and made addition u/sec69A of the Act of Rs.2,00,000/- and finally assessed the total income of Rs.5,05,110/- and passed the order u/sec 143(3) of the Act dated 10.12.2019.
Aggrieved by the order, the assesse has filed an appeal before the CIT(A), whereas the CIT(A) has considered the grounds of appeal, statement of facts, findings of the AO and submissions but has dismissed the assesse appeal. Aggrieved by the order of the CIT(A), the assessee has filed the appeal before the Hon'ble Tribunal.
4. At the time of hearing, the Ld.AR submitted that the CIT(A) has erred in confirming the action of the Assessing officer overlooking the information and submissions filed Seeta Ramachandra Chhappar. Belagavi. in the proceedings. The Ld.AR mentioned that the assesse is having opening cash balance as on 1-04-2016 and the assessment for A.Y.2016-17 was completed under section 143(3) of the Act. The assessee is engaged in conducting stitching classes and the cash deposits in the bank account are out of available opening cash balance and also earnings of the assessee. The Ld.AR substantiated the submissions with the paper book and prayed for allowing the appeal. Per Contra, the Ld.DR supported the order of the CIT(A).
We heard the rival submissions and perused the material on record. The Ld.AR submitted that the CIT(A) has erred in confirming the addition made by the A.O u/sec69A of the Act as the transactions are not supported with the documentary evidences. The Ld.AR explained that the assesse has submitted the details as called for by the revenue authorities. The Ld.AR emphasized that the assesse has filed the information and details mentioning the sources of investments and income earned over the years as disclosed in the statement of affairs. The assesse is having opening cash balance as on 1-04-2016 of Rs.1,42,000/- and the assessment for A.Y.2016-17 was completed under section 143(3) of the Act placed in the paper book and the deposits during the F.Y2016-17 are out of opening cash balance,earnings and past savings. We considering the facts, circumstances and the availability of Seeta Ramachandra Chhappar. Belagavi. opening cash balance and the assessment order of A.Y.2016-17 u/sec143(3) of the Act set aside the order of the CIT(A) and direct the Assessing Officer to delete the addition. And we allow the grounds of appeal in favour of the assessee.
In the result, the appeal filed by the assessee is allowed.
Order pronounced in the open court on 02.04.2025.