MRS. SANGEETA ARORA,NOIDA vs. ITO, NEW DELHI

Brief facts of the case are that the assessee filed his return of income declaring total income of Rs.3,40,450/-. The case was selected for scrutiny for examining the source of cash deposits aggregating to Rs.30,59,000/- in saving bank accounts with Syndicate Bank, Lodhi Road, NBCC Branch as per AIR Information. In response to notice u/s 133(6), bank provided copy of statement of joint saving bank account No.91442010007059 along with her husband, Shri Ravi Arora. The assessee in her reply stated that she was not aware about maintenance of any joint account, which she ever opened and operated, in capacity of first account holder. The Assessing Officer required the assessee to produce her husband. However, since she could not produce her husband, therefore, the Assessing Officer made an addition of Rs.30,59,000/-.

Ld. CIT(A) confirmed the Assessing Officer’s action, inter-alia, observing that even during the appellate proceedings, the assessee failed to explain the source of cash deposits.

Ld. counsel for the assessee referred to page 45 of Paper Book wherein reply dated 07.11.2013 is contained and pointed out that it was, inter-alia, stated that in the joint account all transactions related to her husband who was the first account holder. Ld. counsel, further, referred to page 17 of Paper Book wherein copy of bank account is contained and pointed out that loan was taken by assessee’s husband from Kotak Mahindra Bank for which re-payments have been debited in the account. He referred to page 23 of Paper Book wherein the certificate from Syndicate Bank is contained from which it is clear stated that account was opened in the name of Shri Ravi Arora and assessee’s name was subsequently added on 11.09.2002 after Shri Ravi Arora’s marriage. Thus, he submitted that the addition could not be made in the hands of the assessee. Ld. DR relied on the order of the CIT(A).

I have considered the submissions of both the parties and have perused the record of the case. The assessee’s plea from the very beginning has been that her husband was the first holder of the bank account with Syndicate Bank and it was her husband who was beneficial owner of the bank account. This plea of the assessee has not been controverted by the lower authorities. It is also evident from the certificate of bank that the first account holder was the husband and not the wife. Under such circumstances, the addition could not be made in the hands of the assessee unless it was established that the entries in the said bank account related to wife and not to husband. I find that the facts are not properly examined and under such circumstances matter is restored back to the file of the Assessing Officer to pass order de-novo after specifically verifying the assessee’s contention. The normal presumption is that the entries pertain to first account holder and if it is found that no entries pertained to assessee then no addition can be made in the hands of the assessee. Thus, for this limited purpose, the matter is restored back to the file of the Assessing Officer for de-novo consideration.

In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on this 23rd day of December, 2016.