MOHAMED KAAJA TAJ SADIQ,CHENNAI vs. ITO, NCW-19(4), CHENNAI

Aforesaid appeal by assessee for Assessment Year (AY) 2017-18 arises out of the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 23-09-2023 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 143(3) of the Act on 20-12-2019. The registry has noted a delay of 149 days in the appeal, the condonation of which has been sought by Ld. AR on the strength of affidavit of the assessee which is accompanied by the copy of passport of the assessee. It has been submitted that at the relevant point of time, the assessee was travelling abroad which led to delay in the appeal. Considering the same, we condone the delay and proceed for adjudication on merits.

The Ld. AO noted that the assessee deposited sum of Rs.6.50 Lacs in SBI Bank Account as well as another sum of Rs.5 Lacs in Central Bank of India account. The amounts were deposited during demonetization period and accordingly, the assessee was required to explain sources thereof. The assessee furnished cash book her proprietary concern M/s FRJ leathers for the period from 01-04-2011 to 31-03-2017. The opening cash as on 31-03-2011 was Rs.1.25 Lacs which increased to Rs.43.01 Lacs as on 01-04-2016 which substantial represent cash withdrawals from the bank. The Ld. AO held the same to be unacceptable and made addition of Rs.10 Lacs u/s 69 r.w.s. 115BBE. The mismatch in house property income for Rs.0.69 Lacs was also added to the income of the assessee.

The Ld. CIT(A) observed that cash book was not correctly prepared. The cash book was nothing but capital accumulation and increase of cash-in-hand. No drawings were shown and accordingly, the addition was confirmed. Aggrieved, the assessee is in further appeal before us.

Upon perusal of cash book as placed in the paper-book, it could be seen that the cash book is nothing but mere accumulation of cash withdrawals form the bank. There are very few deposits and withdrawals up-to 01-04-2016. The same would lead to a conclusion that the cash book has been prepared merely to suit the requirements of the assessee. Therefore, this document could not be relied upon to grant relief to the assessee. Another fact is that the assessee is a regular tax filer and earned certain rental income etc. it was quite possible that the assessee was able to save some cash-in-hand out of these incomes earned in earlier years. Considering the same, we restrict the impugned addition to the extent of Rs.3 Lacs and delete the remaining addition. The addition of Rs.0.69 Lacs does not require our indulgence.

The appeal stands partly allowed. Order pronounced on 4th September, 2024 Sd/- Sd/- (MAHAVIR SINGH) (MANOJ KUMAR AGGARWAL) उपा45 / VICE PRESIDENT लेखा सद7 / ACCOUNTANT MEMBER चे9ई Chennai; िदनांक Dated :04-09-2024 DS आदेशकीJितिलिपअ%ेिषत/Copy of the Order forwarded to : 1. अपीलाथ�/Appellant 2. � थ�/Respondent 3. आयकरआयुA/CIT Chennai. 4. िवभागीय�ितिनिध/DR 5. गाडFफाईल/GF