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Income Tax Appellate Tribunal, INDORE SMC BENCH, INDORE
Before: SHRI VIJAY PAL RAO
This appeal by the Assessee is directed against the order dated 11.05.2023 of Commissioner of Income Tax(Appeal), National Faceless Appeal Centre, Delhi for Assessment Year 2011-12. The assessee has raised following grounds of appeal:
“1.Under the facts and circumstances of the case the Ld. CIT(A) erred in confirming action of the AO in passing order w/s 144/147(3) and, while holding the assessment to be valid the Ld. CIT(A) omitted to consider that no notice under section 148 of the Act was served upon the appellant and ex-parte assessment was completed without serving any notice under section 148 of the Act till the completion of assessment which render the Assessment Order void-ab-initio. 2.Under the facts and circumstances of the case the Ld. CIT(A) erred in observing in the appellate order that the appellant id not furnish any information details during the assessment proceedings even though sufficient opportunity of being heard provided by issuing Page 1 of 11
Bhagwati Prasad Jaiswal Page 2 of 11 notices/ show cause notice ignoring the fact that no such notices u/s 148/142(1)were ever served upon appellant and only final order u/s 144/147 was served on his present address of residence. 3.Under the facts and circumstances of the case the Ld. CIT (A) erred in observing in the appellate order that appellant did not mentioned any new address at which he was residing during the assessment proceeding either in the rejoinder to remand report or any submission filed during the appellant proceeding ignoring the basic fact that such address was duly mentioned in Form No. 35 filed by him and the order u's 144/147 was served on this present address of residence. 4.Under the facts and circumstances of the case the Ld. CIT (A) erred in relying upon remand report of the Ld. AO which it self was contrary to the facts, based upon incorrect assumption of facts and without verifying the record and therefore bad in law. Therefore, impugned addition based on the remand report deserves to be quashed. 5.Under the facts and circumstances of the case the Ld. CIT (A) erred in upholding the action of assessing officer in treatment of amount of Rs. 9.00,000/- deposited in bank account as unexplained cash deposit. 6.a Under the facts and circumstances of the case the Ld. CIT (A) erred in not accepting the contention of appellant that cash was also deposited out of withdrawal from account maintained with SBI to his HDFC account and all the entries in bank accounts were well explained. b. The Ld. CIT(A) further grossly erred inobserving in the appellate order that cash was withdrawal at Mumbai SBI ATM Branch (04292) and not from SBI ATMs at Indore and that withdrawal of small cash from one bank ald at Mumbai throughout the year and then redepositing in different bank account at Indore ignoring the fact that any transaction done at any ATM located in any place of the country is compulsorily routed trough ATM Switch Center (04292), Mumbai. Therefore, in the system generated account statement, code of this centralized Branch is appearing. The appellant has withdrawn cash only from the ATM located at Indore. C. The Ld. CIT(A) further grossly erred in observing that the appellant has withdrawn the amount in a very small quantum and it seems that it was withdrawn for personal/ other expenses ignoring the facts given in detailed written submission and rejoinder of remand report of A made before him and that withdrawal was made to the tune of Rs. 25,000/- maximum time, which was the maximum cap of cash withdrawal limit in the ATM at one time. Therefore, addition sustained is based on utter suspicious and conjectures is highly unjustified. Page 2 of 11 Bhagwati Prasad Jaiswal Page 3 of 11 8 The fact of judgment relied on by Ld. CIT(A) is distinguished from the facts of the case of appellant, therefore, not applicable to the present case.”
The assessee is an individual and has not filed any return of income u/s 139 of the Act. The AO received information about deposit of Rs.9,00,000/- in Saving Bank Account with HDFC bank during the year under consideration. Accordingly the AO issued a notice u/s 148 on 23rd March 2018. There was no response on behalf of the assessee to the notice issued u/s 148 and also notice issued u/s 142(1) of the Act. The AO then issued show cause notice to the assessee to explain the source of deposit of Rs.9,00,000/- in the saving bank account with HDFC but there is no reply on behalf of the assessee. Accordingly the AO passed assessment order u/s 144 r.w. section 147 and thereby determined the total income of the assessee at Rs.9,00,000/-. The assessee challenged the action of the AO before the CIT(A) but could not succeed.
Before the Tribunal Ld. AR submitted that the assesse is a retired employee of M.P. State Electricity Board having pension income of Rs.2, 85,848/- per annum. She has further submitted that the assessee is having saving bank account with State Bank of India, Ujjain branch wherein monthly pension is credited. The assessee has shown source of deposit in the HDFC Bank as withdrawn from the State Bank of India as well as cash received from one relative Shri Rajaram Jaiswal father in law for onward transfer to son of assessee residing in USA. Thus the Ld. AR of assesse has submitted and explained source of cash as withdrawn from State bank of India at Rs.8.87 lacs and Rs.5 lac received from Shri Rajaram Jaiswal father in law of the assesse. The Ld. AR has pointed out that the AO did not give proper opportunity to explain source of deposit made in the bank account. The assesse filed additional evidence vide letter dated 06.05.2022 before the Ld. CIT(A) which was forwarded along with written submissions of the assessee to the AO of verification and his comments. The AO submitted the remand report dated 11.11.2022 and objected to the claim of the assessee and source of deposit in the bank
Bhagwati Prasad Jaiswal Page 4 of 11 account after considering remand report of the AO the CIT(A) has confirmed the addition made by the AO.
3.1 The Ld. AR of the assessee has submitted that the assesse is a retired employee of M.P. Electricity Board and having only income from pension as well as agricultural income. Therefore, there is no question of making addition of the deposit made in the bank account. The Ld. AR of the assessee has submitted that the assesse has filed relevant evidence showing a source of deposit in the bank account. She has referred to the bank account of Shri Rajaram Jaiswal and submitted that earlier the son of the assessee remitted sum of Rs.5 lac to the father-in-law of the assessee which was repaid for onward remitting to son of the assessee. Ld. AR thus submitted that this Rs.5 lac is nothing but only repayment of the earlier payment made by the son of the assesse. She has also referred to the various details of the withdrawals made by the assessee from the Saving Bank Account with the State Bank of India. The Account with HDFC Bank was open only in the month on 21.02.2011 for the purpose of remitting amount to the son of the assessee residing in USA. Thus, this deposit was made only for the purpose of onward remittance to son of the assesse residing in USA. Ld. AR has referred to the bank account statement of the assessee and submitted that the assesse has made various withdrawals through ATM during the previous year relevant to the assessment year under consideration amounting to Rs.8.87 lac and further received Rs.5 lac from Shri Rajaram Jaiswal father in law. Thus, the assessee has explained the total availability of the cash with the assessee of Rs.13.87 lacs out of which Rs.9 lac was deposited in the bank account with HDFC bank for remitting the said amount to the son of the assesse. She has referred to the reply filed before the Ld. CIT(A) and submitted that the assessee has given all the details of the funds available with the assessee which includes the pension income of Rs.2,85,562/-, the amount received from the son residing in USA of Rs.3,25,798/- a sum of Rs.1 lac received from Ashok Kumar Jaiswal brother in law of the assessee. The assessee also filed the confirmation letter regarding the Bhagwati Prasad Jaiswal Page 5 of 11 amount of Rs.1 lac received from Ashok Kumar Jaiswal. Ld. AR has submitted that the assessee received a loan of Rs.2 lacs from one Laxman Wagle who has expired on 11.01.2021 but his bank account statement and cash statement was furnished. Thus, there was a deposit of Rs.9,12,619/- in the State Bank of India account of the assesse out of which the assessee has withdrawn a sum of Rs.8.87 lac. Ld. AR has referred to the land record of Shri Rajaram Jaiswal in support of the claim that he was having agricultural income. Accordingly Ld. AR has submitted that the addition made by the AO and confirmed by the CIT(A) is not justified and the same may be deleted.
On the other hand, Ld. DR has submitted that the assessee has claimed the source of deposit as withdrawn from the State Bank of India however, the withdrawal as claimed from the State Bank account are not matching with the deposit made in the HDFC bank. The assesse has shown the withdrawal through ATM of small amount that for the last two years which cannot be considered as a source of deposit in the bank account in the month of February 2011. The assessee also failed to explain the source of Rs.5 lac claim received from the father-in-law of the assessee as no evidence was filed regarding the agricultural income of the payer. He has relied upon the orders of the authorities below.
I have considered the rival submission as well as relevant material on record. The AO has made the addition of Rs.9 lac on account of cash deposit in the bank account of the assessee with HDFC bank for want of any explanation of source of the said deposit by the assesse. The AO has stated in the assessment year passed u/s 144 r.w. section 147 that despite the notices u/s 148 as well as notice u/s 142(1) there was no response on behalf to the assessee and consequently the AO has passed ex-parte assessment order whereby the entire deposit of Rs. 9 lac has been assessed to tax. The assessee challenged the action of the AO before the CIT(A) and also filed the additional evidences being the bank account statement of the assessee, bank account statement of father in law of the assessee, confirmation of loan taken from Ashok Kumar Jaiswal as well as Page 5 of 11
Bhagwati Prasad Jaiswal Page 6 of 11 the land holding record of the father-in-law of the assesse. The CIT(A) forwarded the additional evidence and submissions of the assessee to the AO for remand report. The AO has referred the claim of the assessee regarding source of the claim as well as the affidavit of Shri Rajaram Jaiswal confirming the payment of Rs.5 lac. The AO as well as the CIT(A) has rejected the evidence filed by the assessee on the ground that the confirmation and affidavits filed by the assessee regarding the receipt of Rs.5 lac and Rs.1 lac without any supporting evidence is not sufficient to justify the source of cash deposit in the bank account. The source of Rs.8.87 as withdrawn from the bank account of the assessee with State Bank of India was also denied by the CIT(A) on the ground that the assessee has withdrawn in small-small quantum which is only for meeting personal expenses and not for accumulating amount for later date. Thus, it is manifest from the record that the evidence produced by the assessee was not examined either by the AO or by the CIT(A) to ascertain the correctness of the same from the persons who have given affidavit and confirmation. Further even the credit of the assesee’s pension income as well as received by the assessee from his son was also not given by the AO as well as CIT(A). The assessee has given the details of the amount withdrawn from his SBI bank account as under:
Sr. No. Date Amount of cash withdrawal 1 04.04.2010 10,000/- 2 06.04.2010 11,300/- 3 06.04.2010 25,000/- 09.04.2010 4 15,000/- 25.04.2010 5 10,000/- 01.05.2010 6 10,000/-
Bhagwati Prasad Jaiswal Page 7 of 11 04.05.2010 7 15,000/- 08.05.2010 8 25,000/- 19.05.2010 9 10,000/- 20.05.2010 10 25,000/- 23.05.2010 11 3,000/- 02.06.2010 12 1,000/-
04.06.2010 13 10,000/- 14 04.06.2010 5,000/- 07.06.2010 15 25,000/- 08.06.2010 16 10,000/- 20.06.2010 17 5,000/- 26.06.2010 18 5,000/- 19 13.07.2010 5,000/- 15.07.2010 20 10,000/- 15.07.2010 21 10,000/- 31.07.2010 22 15,000/- 23 08.08.2010 20,000/- 10.08.2010 24 5,000/- 10.08.2010 25 15,000/- 12.08.2010 26 10,000/-
Bhagwati Prasad Jaiswal Page 8 of 11 13.08.2010 27 15,000/- 17.08.2010 28 5,000/- 23.08.2010 29 15,000/- 23.08.2010 30 10,000/-
07.09.2010 31. 15,000/- 14.09.2010 32. 20,000/- 15.09.2010 33 25,000/- 16.09.2010 34 25,000/- 20.09.2010 25,000/- 35 21.09.2010 25,000/- 36 25.09.2010 25,000/- 37 25,000/- 09.10.2010 38
10.10.2010 39 20,000/- 18.10.2010 40 10,000/- 02.11.2010 41 10,000/- 03.11.2010 42 20,000/- 09.11.2010 43 25,000/- 25,000/- 22.11.2010 44 25,000/- 29.11.2010 45 01.12.2010 46 25,000/- Bhagwati Prasad Jaiswal Page 9 of 11
01.12.2010 47 20,000 25,000/- 05.12.2010 48 25,000/- 28.12.2010 49 25,000/- 01.01.2011 50 25,000/- 03.01.2011 51
04.01.2011 52 15,000/- 04.01.2011 53 10,000/- 08.01.2011 54 25,000/- 23.01.2011 55 10,000/- 02.02.2011 56 20,000/- 02.02.2011 57 5000/- 02.02.2011 58 20,000/- 09.02.2011 59 5,000/- 05.03.2011 60 25,000/-
Apart from this amount of Rs.9,12,619/- credited in the saving bank account of the assessee with SBI the assesse further claimed a cash of Rs.5 lac received from Shri Rajaram Jaiswal father in law of the assessee and also filed the bank account statement of Shri Rajaram Jaiswal showing that an identical amount for Rs.5 lac was received as remittance by the son of the assessee. Therefore, even if the claim of the loan of Rs.3 lac is doubted the other amount of Rs.2,85,562/- and Page 9 of 11
Bhagwati Prasad Jaiswal Page 10 of 11 Rs.3,25,798/- which was credited in the bank account of the assessee on account of pension income and amount received from son of the assessee cannot be disputed. The assessee has produced all the relevant evidence in support of these sources of the availability of funds which was rejected by the AO as well as by the CIT(A) without bringing any contrary facts or material on record. Once the additional evidence was forwarded to the AO for verification and his comments then the AO ought to have examined the said evidence as well as the persons who have issued the confirmation and filed affidavit. Therefore when the confirmation and affidavit admitting the payment to the assesse were filed then without examining persons of giving affidavit and confirmation the claim of the assessee cannot be brushed aside. The AO as well as the CIT(A) has not disputed withdrawal of the amount by the assessee from SBI Account however, the source of the said amount for deposit in the bank account with HDFC was denied on the ground that these amounts withdrawn with small small quantum and for personal use of the assessee and not for accumulating the money for deposit in the bank account. All these reasons are not based on the verification of the fact and analyzing the details as how the assessee is meeting his day to day household expenditure and could have save an amounts as a source of deposit on subsequent dates. Therefore, facts and circumstances of the case and in the interest of justice when the assessee has explained the source of availability of the funds of more than 13 lacs out of which a sum of Rs.9 lac is deposited in the bank account of the assessee then the addition made by the AO and confirmed by the CIT(A) is not justified and the same is deleted. Page 10 of 11
Bhagwati Prasad Jaiswal Page 11 of 11 7. As regards the ground no.1 & 2 of the assessee in view of the finding of the merits of the case the ground no.1 & 2 becomes infructuous and accordingly dismissed.
In the result, the appeal of assesse is allowed.
Order pronounced in the open court on 13.12.2023