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Facts
The assessee failed to file a return of income for AY 2011-12. Based on AIR information, it was found that the assessee had deposited Rs. 17,00,000/- in cash into his savings bank account. Despite notices, the assessee did not provide a satisfactory explanation for the source of these funds, leading the Assessing Officer (AO) to reopen the assessment and make an addition.
Held
The tribunal observed that the assessee, claiming to be an agriculturist, might not have had readily available documents during the assessment proceedings and that the CIT(A) had dismissed the additional evidence. To ensure justice, the tribunal decided to grant the assessee an opportunity to present his case and evidence before the CIT(A).
Key Issues
Whether the CIT(A) erred in confirming the addition for unexplained cash deposit and in not accepting additional evidence, particularly when the assessee claimed the source to be agricultural income.
Sections Cited
147, 143(3)
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Income Tax Appellate Tribunal, SURAT BENCH, SURAT
Before: Shri Sanjay Garg & Shri Bijayananda Pruseth
"ी संजय गग", "ाियक सद" एवं "ी िबजयान ा !ुसेथ, लेखा सद" के सम'। ] ] Before Shri Sanjay Garg, Judicial Member And Shri Bijayananda Pruseth, Accountant Member आयकर अपील सं /ITA No.62/SRT/2024 िनधा"रण वष" /Assessment Year : 2011-12 Dilipkumar Dahyabhai Patel The Income Tax Officer बनाम/ Moti Kanbiwad Tankal Ward-2 v/s. Tal. Chikhli Navsari Navsari – 396 560 "थायी लेखा सं./PAN: ASIPP 6274 H (अपीलाथ(/ Appellant) (!) यथ(/ Respondent) Assessee by : Shri Hardik Vora, AR Revenue by : Shri Ajay Uke, Sr.DR सुनवाई की तारीख/Date of Hearing : 19/11/2025 घोषणा की तारीख /Date of Pronouncement: 17/02/2026 आदेश/O R D E R
Per Sanjay Garg, Judicial Member:
The present appeal has been preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘CIT(A)’] dated 23/11/2023 for the Assessment Year (AY) 2011-12.
The assessee has raised the following grounds of appeal:
1. On the facts and circumstances of the case as well as law on the subject, the learned CIT (Appeals) has erred in confirming the addition of Rs.17,00,000/- on account of unexplained cash deposit. Dilipkumar Dahyabhai Patel vs. ITO Asst. Year : 2011-12 2
2. On the facts and circumstances of the case as well as law on the subject, the learned CIT (Appeals) has erred in not accepting additional evidences as per Rule 46A of Income Tax Rules, 1962.
3. On the facts and circumstances of the case as well as law on the subject, the learned CIT (Appeals) has erred in not considering that cash deposits in bank account are on account of agricultural income.
4. It is therefore prayed that the above addition/disallowance made by the assessing officer may please be deleted.
5. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal.:
3. The brief facts of the case are that assessee is an individual and did not file his return of income for the year under consideration. On verification of the AIR information received by the office of the IT Department, Navsari, it revealed that the assessee has deposited cash amounting to Rs.17,00,000/- in his saving bank account during the relevant financial year. A query letter was issued to the assessee on 24/01/2017 to furnish the source of cash deposited made during the relevant financial year and in response thereof, the assessee did not furnish his reply to the Assessing Officer (AO). Therefore, the AO reopened the assessment of the assessee u/s 147 of the Act. In the reopened assessment proceedings, since the assessee did not explain the source of the aforesaid deposits, therefore, the AO made the addition of Rs. 17 lakhs on account of unexplained cash deposited in the bank account of the assessee.
4. Aggrieved by the order of the AO, the assessee preferred the appeal before the Ld. CIT(A), who dismissed the appeal of the assessee, by observing as under: “6.4 I find from the assessment order that the appellant was given sufficient opportunity to explain the cash deposit and even before finalizing the order a show cause notice was also issued for the proposed addition of Rs. 17,00,000/- but the Dilipkumar Dahyabhai Patel vs. ITO Asst. Year : 2011-12 3 appellant did not availed such opportunity also. Before me the appellant has submitted various documents as additional evidence but the same were not admitted for the reasons already discussed in para above. During the assessment proceedings the appellant to explain the source of cash deposit furnished an affidavit of Smt. Laxmiben C. Patel, wherein it is stated that the assessee has done agriculture activities on her land. However, no supporting evidence was produced which could prove the productivity of agriculture produce and no details of expenses for such activities were also filed. Being unsatisfied with such type of explanation the Ld AO Issued a show cause notice giving the appellant another opportunity to explain the source of cash deposit of Rs. 17,00,000/- with cogent material but the he remained non-complied.
6.5 Before the AO, inspite of numerous opportunities given to the appellant, the appellant did not make use of these opportunities giving the concrete impression to the undersigned that the assessee had nothing to say or no explanation whatsoever with regard to the deposit in the bank account by way of cash during the AY 2011- 12. Hence, the AO had no option but to consider the cash deposit of Rs. 17,00,000/ as unexplained income and add the said amount. Keeping in view all the stated facts and discussions, I find no reason in altering the additions made by the AO. In view of this, the grounds raised by the appellant are dismissed.”
Aggrieved by the aforesaid order of the Ld. CIT(A), now the assessee is in appeal before us.
We have heard the rival contentions of the Ld. Representatives of the parties and gone through the record. The Ld. Counsel for the assessee has submitted that the assessee is an agriculturist and was not conversant about the income-tax assessment procedures. That the requisite documents explaining the source of deposits in the bank account of the assessee were not readily available with the assessee during the assessment proceedings. That the assessee, however, had furnished the requisite details and evidences before the Ld. CIT(A), however, the Ld. CIT(A) dismissed the application of the assessee for furnishing the additional evidences. He, therefore, has submitted that the assessee has a fair case on merits and that assessee may be given an opportunity to present his case before the Ld. CIT(A). Dilipkumar Dahyabhai Patel vs. ITO Asst. Year : 2011-12 4
After considering the rival submissions, we are of the view that the interests of justice demand that the assessee may be given an opportunity to furnish the evidences regarding the source of deposits in his bank account. Accordingly, the impugned order of the Ld. CIT(A) is hereby set aside and matter is restored to the file of the Ld. CIT(A) for decision afresh. It is further directed that the Ld. CIT(A) will give opportunity to the assessee to furnish the requisite details and evidences. The Ld. CIT(A), if so deem fit, may call upon the remand report from the AO on such evidences furnished by the assessee. The Ld. CIT(A), thereafter, will decide the appeal of the assessee on merits in accordance with law.