RAGHUVIR SINGH,GWALIOR vs. ASSESSING OFFICER , ITO GWALIOR

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ITA 204/AGR/2023Status: DisposedITAT Agra03 February 2025AY 2011-2012Bench: SHRI SATBEER SINGH GODARA (Judicial Member), SHRI M. BALAGANESH (Accountant Member)1 pages
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What did the Tribunal hold?

The Tribunal found that neither the assessee fully proved the source nor the department fully rebutted the possibility of accumulated savings. Therefore, the addition was restricted to a lump sum of Rs. 5 lakhs, and the penalty under Section 271(1)(c) was deleted.

What were the facts?

The assessee made cash deposits of Rs. 13,28,528/- in their bank account, which the lower authorities treated as unexplained. The assessee claimed these deposits represented accumulated past savings from business receipts.

What were the issues?

Whether cash deposits in a bank account are unexplained income, and the validity of imposing a penalty for such additions when evidence is subjectively appreciated.

Which sections of the Income-tax Act were involved?

Section 68,Section 69A,Section 271(1)(c),Section 274

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Income Tax Appellate Tribunal, AGRA BENCH, “SMC” AGRA

Before: SHRI SATBEER SINGH GODARA & SHRI M. BALAGANESH

Hearing: 03.02.2025Pronounced: 03.02.2025

PER SATBEER SINGH GODARA, JM These assessee’s twin appeals & 205/Agr/2023 for assessment year 2011-12, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s DIN and order nos. ITBA/NFAC/S/250 /2023-24/1053359491(1) and ITBA/NFAC/S/250/2023- 24/1053355418(1), dated 31.05.2023 involving proceedings under sections 271(1)(c) and 274 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’), respectively.

2.

Heard both the parties. Case file perused.

3.

We advert to the assessee’s quantum appeal ITA No. 205/Agr/2023. The delay of 131 days in filing the assessee’s instant appeals stands condoned as per his contentions/averments explaining reasonable cause on account of the situation beyond his control.

4.

It emerges during the course of hearing that both the lower authorities have treated the assessee’s cash deposits in bank account to the tune of Rs.13,28,528/- as unexplained under section 68/69A of the Act.

5.

Learned counsel’s case before us in these circumstances is that the assessee herein is a small contractor having derived various business receipts in cash and some of the cash deposits herein represent his personal and his family’s “accumulated” past savings etc.

6.

The Revenue’s case, on the other hand, is that it was the assessee’s bounden duty to plead and prove all the relevant facts,

1.

2 | P a g e and, therefore, the impugned addition forming subject matter of our adjudication deserves to be upheld.

7.

We have given our thoughtful consideration to the assessee’s and Revenue’s vehement rival submissions, we do not see any reasons to express our concurrence with either parties’ stand in entirety. This is for the precise reason that neither the assessee has pleaded or prove all the foregoing facts all along, nor the department could rebut the necessary inference that the taxpayer could very well be presumed as having some accumulated past savings, keeping in mind his socio-economic stats. We thus deem it appropriate in these peculiar facts and circumstances to restrict the impugned addition of Rs.13,28,528/- to a lump sum amount of Rs.5 lakhs only with a rider that the same shall not be treated as a precedent. The assessee gets the relief of Rs.8,28,528/- in other words. His appeal is partly accepted.

8.

Coming to the assessee’s consequential penalty appeal the Revenue could hardly dispute that section 271(1)(c) penalty in an instance of such an estimated cash deposits addition, would not be sustainable in law going by the CIT v. Reliance Petroproducts (P) Ltd. (2010) 322 ITR 158 since involving

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