Loading judgment…
Facts
Assessee, Chanchala Kumari, made a cash deposit of Rs. 24.33 lakhs during the demonetization period, which led to an ex-parte assessment by the AO adding the amount under section 69A. The assessee contended that the bank account and deposits belonged to her partnership firm, M/s Ram Saran Dass Surinder Kumar, and submitted supporting documents, but the CIT(A) dismissed the appeal without considering fresh evidence due to the lack of an application under Rule 46A.
Held
The Tribunal observed that documentary evidence suggested the cash deposits belonged to the partnership firm, which is separately assessed. Therefore, the matter was set aside and remanded to the Assessing Officer for fresh assessment. The AO is directed to verify all documentary evidence and books of account to confirm if the cash deposits were sale proceeds of the partnership business and were fully explained.
Key Issues
Whether cash deposits made during demonetization by an individual assessee actually belonged to her partnership firm, and whether the CIT(A) erred in dismissing the appeal without considering fresh evidence.
Sections Cited
Section 250, Section 144, Section 69A, Rule 46A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR
Before: SH. UDAYAN DASGUPTA & SH. KHETTRA MOHAN ROY
This appeal is filed by the assessee against the order of the ld. CIT (A) NFAC, Delhi dated 29.08.2024 passed u/s 250 of the Income Tax Act, 1961 which has emanated from the order of the ITO, Ward-1(1), Jammu passed u/s 144 of the Act, 1961 dated 20.12.2019.
The main contention of the assessee is that the first appellate authority has dismissed the appeal by non-speaking order without allowing proper opportunity of being heard, even though it is seen that the written submissions has been filed in response to the notices issued from the office of the ld. first appellate authority.
Brief facts emerging from record are that the assessee has made cash deposit amounting to Rs.24.33 lakhs in SBN during the demonetization period, in his bank account. It was also observed that the total deposit or total credit in bank account was to the tune of Rs.1.17 crores for the entire financial year (excluding the amount deposited during the demonetization period). In absence of any response or explanation from the assessee to various notices issued by the AO, the assessment has been completed ex-parte on a total income of Rs.33.72 lakhs (including of an amount of Rs.24.33 lakhs on account of SBN deposit u/s 69A of the Act, plus eight percentage of remaining credits in the bank account).
The matter was carried in appeal and written submissions has been filed by the assessee through portal where the assessee has claimed that the cash deposited in bank account is actually the bank account of the partnership firm M/s Ram Saran Dass Surinder Kumar (PAN: AAPFR 3211D). He also filed copies of the partnership deed consisting of four partners out of which the assessee, Chanchala Kumari is one statement and copy of the bank account of the partnership firm maintained with Jammu & Kashmir Bank, being A/c No. xxxxxxx000909 and submitted that the bank account belongs to the partnership firm and same is duly reflected in the audited balance sheet, and the cash deposited in bank account are reflected in the regular cash book of the partnership concern and the assessee individually is not the owner of the same.
However, the ld. first appellate authority has dismissed the appeal on the ground that application under Rule 46A for submission of fresh evidence has not been made by the assessee and as such there is no reason to interfere with the well reasoned order of the AO, thereby dismissing the appeal.
In course of appeal before the Tribunal, the ld. AR of the assessee reiterated the same submissions that cash has been deposited in the bank account of the partnership firm of M/s Ram Saran Dass Surinder Kumar (PAN: AAPFR 3211D) which is separately assessed to tax, and the firm engaged in the trading of Kirana (grocery) goods and the cash deposited in bank account are out of sale proceeds of kirana business and are duly reflected in the regular books of account of the partnership, and the cash deposited during the demonetization period are out of the cash balance available on the date of demonetization.
Kashmir Bank who has certified that the current A/c No. xxxxx000909 was opened on 7th September, 2017 in the name of the partnership firm M/s Ram Saran Dass Surinder Kumar consisting of four partners out of which Chanchala Kumari is one of the partners. We also find that the said bank account is duly reflected in the audited account of the partnership concern. The ld. AR also referred to the acknowledgement receipts as evidence of submissions made before the CIT(A) dated 18.08.2024 and submitted that all documentary evidences has been uploaded in the portal with full clarifications and explanations which has not been properly considered by the ld. first appellate authority and if proper cognizance is given to the said documents, then no addition in the hands of the assessee will be justified.
The ld. DR relied on the order of the ld. CIT(A).
We have heard the rival submissions and considered the materials on record and we find that, apparently from the documentary evidences submitted before us by way of paper book, the bank A/c were cash has been deposited, during the demonetization period (being A/c No. xxxxxxx000909) Jammu & Kashmir Bank, are reflected in the audited balance sheet of the partnership firm, and are also supported by audited accounts, audited report, banker’s certificate and partnership deed which claimed by the assessee, the same is also reflected in the regular return of firm.
As such, we are of the opinion, the matter needs to be verified by the Assessing Officer and in the interest of justice, we set aside the mater back to the files of the Assessing Officer for fresh assessment and we direct the assessee to file all documentary evidences in support of his contention along with the books of account to establish the fact that the cash deposited in bank during the demonetization period are out of sale proceeds of the partnership business and are related to the partnership and are fully explained.
We have not expressed any opinion on merits of the case and all legal issues are left open.
In the result, the appeal filed by the assessee is allowed for statistical purpose.
Order pronounced in open court as on 22.08.2025.