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Facts
The case was reopened as per AIR information indicating the assessee deposited Rs. 10,14,000 in a saving bank account. The assessee claimed the transaction related to his employer company, M/s OGLACS Software Ltd., due to the company's inability to conduct online transactions. The company deposited cash into the assessee's account for these transactions.
Held
The Tribunal considered the assessee's contentions and the facts presented. Recognizing the need for a fair determination of income, the Tribunal decided to grant the assessee another opportunity to present their case. Consequently, the orders of the Assessing Officer and the CIT(A) were set aside.
Key Issues
Whether the cash deposits into the assessee's personal account were related to his employer's business and if a further opportunity should be given to the assessee to prove his case.
Sections Cited
144, 148, Income Tax Act, 1961
AI-generated summary — verify with the full judgment below
Date of Hearing 01.04.2025 Date of Pronouncement 19.05.2025 ORDER, PER BRAJESH KUMAR SINGH, AM,
This appeal filed by the assessee is directed against an order dated 18.07.2024 of the Ld. Addl./JCIT(A)-5, Mumbai, relating to Assessment Year 2011-12 arising out of order u/s 144/148 of the Income Tax Act, 1961 (hereinafter referred to ‘the Act’) dated 15.12.2018 passed by Income Tax Officer, Ward-1(2)(4), Agra.
Brief facts of the case:- The case was reopened u/s 148 of the Act vide notice dated 28.03.2018 for the reason that as per AIR information, the assessee had deposited cash totalling to Rs.10,14,000/- in saving bank account with ICICI bank. According to the Assessing Officer, no return of income was filed and no satisfactory explanation was furnished in reply to various notices issued by the Department. During the course of assessment proceedings, it was submitted by the assessee that the transaction in the said bank account did not relate to him but the same related to the company (M/s OGLACS Software ltd.), where, he was working as employee.
It was further submitted by the assessee that the said company was unable to do online transactions with the bank and therefore the company undertook the transaction in the assessee’s personal saving bank account.
The assessee also submitted a letter dated 01.12.2014 of the company, wherein, the said fact was stated by the Director of the said Company. The Assessing Officer tried to verify the contention of the Director from the assessee company but all the letter sent to the company were returned back by the postal authorities with remark ‘un-served’. Therefore, the Assessing Officer added a sum of Rs.10,14,000/- as income from undisclosed sources.
Aggrieved with the said order, the assessee filed an appeal before the ld. First Appellate Authority (in short ‘FAA'). The Ld. FAA did not accept the explanation of the assessee on the ground that the assessee had not furnished any certificate from the bank regarding the company’s claim of facing difficulty in doing online transactions with the bank. Further, the Assessing Officer was also of the view that it was highly improbable that such a problem with the bank account in a highly reputed private bank will persist for more than three months.
Against the said order, the assessee is in appeal before us. The assessee has taken various grounds and filed a statement of facts. The critical facts submitted by the assessee in his statement of facts are reproduced as under:-
• Since the Appellant was the employee of the company and was working on a profile which requires to recharge the facility in the online mode to serve the client, he was under a moral obligation to accept the company's requests and to do as was desired by the company. • Further, it is pertinent to mention before your Honour that Appellant is just an employee of the company and in the human tendency, he cannot deny the company's instructions as there is always a fear of losing the job. Since the employee was already working with such a profile, he was well aware that the recharge of the account is to be done on online mode only to serve the clients, he decided to accept the company's advice and used his personal account no. #061001508119 to the transfer transaction on behalf of the company till the problem with the bank sorted. • Further, it is submitted that the company used to deposit the cash in the account of the Appellant for all the recharges done and the same is clearly evident in the account statement. • All the online Google AdWords recharges were followed by the cash deposits done by the company as the same required to be done by the company only and the account of the Appellant was just temporarily used till the problem with the Kotak Mahindra Bank was fixed. The same is clear from the bank statement of the Appellant which was also provided to the Assessing officer.
The ld. Sr. DR supported the orders of the authorities below.
We have considered the above contention made by the assessee in the statement of facts filed before us. The same is very vital for determining the correct income in the hands of the assessee. We, therefore, consider it appropriate that in the interest of justice one more opportunity be given to the assessee. Therefore, the order of the Assessing Officer as well as the ld. CIT(A), is set-aside and the matter is remitted to the file of the Assessing Officer for afresh adjudication after giving a reasonable opportunity of being heard to the assessee in light of the above observations and as per law.
Further, the assessee is also directed to represent before the Ld. Assessing Officer during the assessment proceedings. Accordingly, grounds of appeal raised by the assessee are allowed for statistical purposes.
Order pronounced in the open court on 19TH May, 2025.