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Facts
The assessee, a 75-year-old lady, deposited ₹10,15,500/- in cash into her bank account during the demonetization period without filing a return of income. A significant portion of this sum, ₹9,85,000/-, was immediately transferred to another firm. The Assessing Officer (AO) made an addition of ₹10,15,500/- to the total income as unexplained credit.
Held
The Tribunal noted that the assessee claimed the cash deposit represented savings and was for emergency requirements due to her age and health. However, the AO and CIT(A) rejected this explanation, citing the assessee's limited means and the small scale of her business. A significant issue raised was the denial of a proper opportunity of hearing to the assessee due to multiple notices and transfer of the case.
Key Issues
Whether the addition of unexplained cash credit to the assessee's income is justified, and whether the principles of natural justice were violated due to insufficient opportunity of hearing.
Sections Cited
69A, 115BBE, 144, 133(6), 142(1)
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Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
Smt. Minaxi Ramesh Dalal (assessee /appellant), for A.Y. 2017-18, against the appellate order passed by the National Faceless Appeal Centre, Delhi [the learned CIT (A)] dated 30th November, 2023, wherein the appeal filed by the assessee against the assessment order passed under Section 144 of the Income-tax Act, 1961 (the Act) on 6th December, 2019, by the Income Tax Officer, ward 23(2)(6), Mumbai, was dismissed.
The assessee has raised following grounds of appeal:-
2. The Ld. CIT (A) erred in law and on facts in merely echoing the view of the AO without appreciating the submissions of the Appellant that the source of such cash deposits in bank account was the Appellant's past savings over a period of several years.
3. The Ld. CIT (A) erred in law and on facts in not considering the submissions of the Appellant in proper perspective.
4. The Ld. CIT (A) erred in law and on facts in not giving sufficient opportunity of being heard to the Appellant and hence the principles of natural justice are violated.”
Brief facts of the case shows that assessee is a 75 year old lady, who did not file any return of income. On the basis of data analytics, an information gathered on online verification for operation clean money, It was found that assessee has deposited ₹10,15,500/- in her bank account during demonetization period in cash . Out of the above sum, the cash deposit of ₹9,85,000/- was immediately transferred to a partner of another firm M/s Hira Traders. As the assessee did not file any return of income, did not respond to any notices. In response to show cause notice, assessee explained that she has income in last six years
The learned Assessing Officer called for the bank statements from Axis Bank by issuing notice under Section 133(6) of the Act, wherein the sum of ₹9,85,0000/- was deposited.
Explanation was rejected and ld Ago held that the amount of ₹13,80,000/- earned by him cannot be accepted. He further found that assessee has purchased gold of ₹9,50,000/- for her son's marriage and for which ₹9,85,000/- was deposited in the bank account on 17th November, 2016.
The assessee was further issued a show cause notice to explain the source of the money deposited. The assessee did not file any response and thereafter the learned Assessing Officer made an addition of ₹10,15,500/- to the total income of the assessee in assessment under Section 144 of the Act was issued on 6th December, 2019.
The assessee preferred the appeal before the learned CIT (A), wherein the assessee reiterated the facts of the case and further stated that sufficient opportunity of hearing was not given to the assessee. The assessee also explained that last show cause notice issued by the learned Assessing Officer could not be replied by the
The learned CIT – A held that assessee was given sufficient notices for hearing but assessee did not come forward with proper explanation about the source of cash deposit in her bank account during demonetization period and therefore there is no infirmity in the order of the learned assessing officer. Further as the husband and the sons of the assessee are doing small activities, looking at the age of the assessee of 79 years suffering from different diseases, smallness of the business, he held that assessee does not have sufficient source to have an accumulated cash in hand of about ₹ 10.15 lakhs. Accordingly the order of the learned assessing officer is upheld.
Despite notice none appeared on behalf of the assessee, therefore, the appeal of the assessee is decided on the merits of the case as per information available on record.
The learned departmental representative vehemently supported the orders of the learned lower authorities.
We have carefully considered the contentions raised by the learned lower authorities and their assessment order. We find that assessee is a 79 years old lady who has
In the result appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open court on 19.8.2024.