Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR.
Before: SH. MANOJ KUMAR AGGARWAL & SH. UDAYAN DASGUPTA
ORDER Per: Udayan Dasgupta, J.M.: This appeal filed by assessee is against order of Ld. JCIT (A)-4, Kolkata, passed u/s 250 of the I.T. Act 1961, dated 27.08.2024 which has emanated from the order of the AO, Ward 1(4), Mansa, dated 16/12/2019, passed u/s 144 of the I.T. Act, 1961. 2. The grounds of appeal in Form No. 36 are as under:
1. The ADDL-JCIT (A) has erred on facts and law in confirming the addition, vide order u/s 250 of the Act Dt. 27.08.2024, made by the AO amounting to Rs. 9,50,000/- u/s 69A r.w.s. 115BBE of the Act, vide order u/s 144 of the Act Dt.
16.12.2019, on account of alleged unexplained cash deposits during the period of demonetization.
The ADDL-JCIT (A) has erred on facts and law in confirming the addition, vide order u/s 250 of the Act Dt. 27.08.2024, made by the AO amounting to Rs. 9,50,000/- u/s 69A r.w.s. 115BBE of the Act, vide order u/s 144 of the Act Dt. 16.12.2019, on account of alleged unexplained cash deposits during the period of demonetization as the counsel of the assessee did not comply to the notice u/s 250 of the Act dt. 29.07.2024, served through e-mail of the counsel, and the assessee was prevented by sufficient cause for non-compliance of notice u/s 250 of the Act.
The ADDL-JCIT (A) has erred on facts and law in confirming the addition, vide order u/s 250 of the Act Dt. 27.08.2024, made by the AO amounting to Rs. 9,50,000/- u/s 69A r.w.s. 115BBE of the Act, vide order u/s 144 of the Act Dt. 16.12.2019, on account of alleged unexplained cash deposits during the period of demonetization without appreciating the contentions raised by the assessee in the grounds of appeal
raised before ADDL-JCIT (A).
4. That the appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed of.”
3. The brief facts emerging from the record are that the assessee has deposited cash during demonetisation period (amounting to Rs.9.50 lakhs in HDFC Bank, Mansa A/c no. XXXXXX50235). The return filed by the assessee, declaring NIL income and agricultural income at Rs.13.2 lakhs was selected for scrutiny under CASS. In absence of any response to notice u/s 143(2) and subsequent notices issued u/s 142(1), the assessment was completed on a total income of Rs.9.50 lakhs (plus Agricultural income as per return). 3.1 In course of appeal before the first appellate authority, written submissions were filed by the assessee, explaining the source of bank deposit to have come out of agricultural income. The first appellate authority, sought further clarifications and issued notice to the appellant on 29.07.2024 in the following e-mail id gurtej10dandiwal@gmail.com, parshotamsingla@yahoo.com, and rkjindal1008@yahoo.in . In absence of any compliance to this particular notice the addition was sustained and the appeal has been dismissed by the first appellate authority by observing as follows: “Ground No. 3 to 6:- The Grounds are on a single issue of addition of cash deposit amount u/s 69A and as such the Grounds are adjudicated together. Here the Appellant has agitated over the addition of the amount of cash deposit of Rs 9,50,000/- during the demonetization period. The Appellant claimed that when the Agricultural Income of Rs 13,20,145/- has been admitted, the sources of cash deposit should be treated as explained. The Appellant also claimed that as per the Govt Circular, each person can deposit cash of Rs 2.5 lakhs during demonetization period and the Appellant is having father, mother and wife, the cash deposit should be treated as deposited by each of them. Specific query was made regarding the claim of cash deposit from agricultural income. No reply with explanation nor document has been filed. Regarding the claim of cash deposit by family members, no explanation has been filed regarding the profession of mother, wife etc. As mentioned in the notice u/s 250, the Appellant has filed the ITR mentioning the information that Rs 9.5 lakhs have been deposited by him in his bank account. The Appellant has not uploaded the Bank Statement Copy as specifically asked to verify the pattern of cash deposit. As for example, if it is found that sufficient cash was deposited just before 08/11/2016, there would have been no explanation why the balance cash was not deposited if it is claimed that the entire cash belongs to his agricultural income. No explanation has been filed as to what were the crops that were sold in last week of October, 2016 and first week of November, 2016. No evidence has been filed to show that such cash in hand is normal in his agricultural activities. No evidence has been filed to show that the Appellant was having huge agricultural land and there were actually any agricultural activities for a number of years. The case was taken up for issuing notice u/s 142(1), calling for Return as no ITR was filed for A Y 2017-18 when there was huge cash deposit during the demonetization. So, the addition is restricted only to the amount of cash deposit made during the demonetization. It doesn’t mean that the claim of agricultural income has been verified and found in order. All submissions are only NARRATIVE without any supporting document. As the Appellant has not furnished any document regarding the presence of agriculture activities, there is no scope of any partial allowance of this ground also. If in such cases, the huge cash deposit during the demonetization is treated as normal, the very purpose of Demonetization will be defeated. The Appellant is not authorized to take such cash from others and deposit the same in his bank account against whatever best known to the Appellant. Hence, these grounds are DISMISSED.”
4. Now the matter is in appeal before the tribunal on the ground contained in memorandum of appeal.
5. In course of hearing, the ld. AR of the assessee filed a short paper book, containing jamabandi of agricultural land (as proof of ownership of land), ‘J’ Form (as proof of agricultural income) and has filed a written submission by way of brief synopsis alongwith copies of bank statement of the assessee in HDFC Bank where the cash of Rs.9.50 lakhs has been deposited during the demonetisation period. 5.1 The ld. AR submitted that the assessee belongs to an agriculturist family and there is no other income other than the agriculture income, and the return of income has been filed disclosing agricultural income of Rs.13.20 lakhs (thirteen lakhs twenty thousand) the year under appeal and the same has been accepted by the AO. He further referred to the details of ‘J’ Form issued by the parties (placed in 5.2 paper book page 43) to submit that the total agricultural receipts during the period April 2016 to November 2016 was Rs.15,55,305/- out of which agricultural expenses was Rs.2,35,160/-, leaving a balance of Rs.13,20,145/-, being the income disclosed in the income tax return. The details furnished by the assessee are reproduced in paper book page 43 as follows:
Details of J Forms Sr. Date Particulars Amount No. 1. 20-04-2016 Punjab Agri Seeds Farm, Mansa 9,45,200 2. 18-11-2016 M/s Kheta Mall Krishan Chand 3,36,132 3. 18-11-2016 M/s Kheta Mall Krishan Chand 1,59,662.70 4. 22-11-2016 M/s Janta Sales Agency 1,14,311 Total 15,55,305.70 Details of Agricultural Income Particulars Amount Gross Agriculture Income 15,55,305.70 Less: Agricultural Expenses 2,35,160 Net Agricultural Income declared in ITR 13,20,145 5.3 The contention of the ld. AR is that the net agricultural income declared by the assessee at Rs.13.20 lakhs is sufficient enough to cover the deposit of Rs.9.50 lakhs in bank A/c and as such, he prayed that the addition on this count may please be deleted. 5.4 He further relied on the order of the coordinate benches of the tribunal and argued that in the instant case, since the assessee has got no other income other than the agricultural income and the AO has also not brought on record any other income to have been earned by the assessee or his family, the deposit of cash in the bank account should be deemed to have come out of agricultural income only. On this issue, he has relied on same judgments of coordinate benches: i. Arvindbhai Chhotabhai Patel vs. ITO, dated 06.08.2010 (Ahmedabad). ii. ITO vs. Smt. Shahnaj Bano, dated 07.01.2005 (ITAT- Indore) iii. Narendra Badjatiya vs. ITO in ITA No. 537/Ind/2006 (ITAT Indore) iv. Gopalbhai vs. Bhoiwala vs. ITO, ITA No.3008/Ahd/2009 dated 08.01.2010 (Ahmedabad).
5.5 He prayed for deleting the above addition of Rs.9,50,000/-.
Per contra, the ld. DR relied on the order of the ld. CIT(A) and has submitted that in the instant case, the assessee has received Rs.9,45,200/- on 20th April 2016 as evident by ‘J’ Form issued by Punjab Agro Seeds Farm, Mansa, and thereafter no further amount has been received till 15th November 2016 ( the balance of Rs.6.10 lakhs received later on). 6.1 He further stated that even for the sake of argument if it is accepted that the amount of Rs.9,45,200/- has remained with the assessee from month of April 2016 till the month of November 2016 for the purpose of deposit in bank account even then also there is cash short of Rs.4,800/- (Rs.9,50,000/- (-) Rs.5.45,200/-). He further relied on the judgment of the jurisdictional High Court in the case of Smt. Kavita Chandra vs. CIT(A), Panchkula and others ITA 421/2016 dated 07.03.2017 to submit that in an almost identical case the Hon’ble Court has observed as follows:
16. Moreover, we also agree with the learned C1T(A) that in the absence of any detail of expenses incurred by the assessee in this period the cash flow statement has no relevance and the entire withdrawal cannot be said to have been redeposited.
6.2 Relying upon the said judgment he prayed that the order of the ld. CIT(A) may please be upheld.
We have heard the rival submissions and considered the materials on record and we find that the assessee belongs to an agriculturist family and there is no other income other than the agricultural income. At the same time, we also note that the assessee and his family is the owner of 21.5 acre (twenty one and half) of agricultural land where cultivation takes place and as proof of such existence jamabandi is enclosed in the paper book. We are also of the opinion, that as stated by the ld. AR some agricultural produce is also sold in the open market i.e. (outside mandi) to common public, the receipts of which also needs be taken into account. We also note the observation of the Hon’ble Jurisdictional High Court in the case of Kavita Chandra (supra) that in absence of any details of expenses incurred by the assessee the cash flow statement has no relevance and the entire cash withdrawal cannot be said to be redeposited. In other words, as per the Hon’ble Court redeposit of cash after a gap of two 7.1 to three months is not probable and in the instant case cash is being deposited after seven months. However, considering the totality of the facts and circumstances of the case, the cash available with the assessee as per ‘J’ Form and also taking into account the fact that some agricultural produce (derived from cultivation of 21.5 acres of agricultural land) which also must have been sold outside mandi and also considering that some expenses might have been incurred by the assessee, for the months April to October 2016 we take a very logical view in this case, and we are of the opinion that an amount of Rs.8 (eight) lakhs will be available to the assessee for depositing in bank a/c during demonetisation period and as such, we are of the opinion that out of the total deposit Rs.9.50 lakhs in bank on 15.11.2016 the benefit of Rs.8 lakhs is to be allowed (as explained and as such the addition is restricted to Rs.1.50 (One Lakh Fifty Thousand), and the assessee gets consequential relief.
In the result, the appeal of the assessee is partly allowed.