RAMESHBHAI CHHAGANBHAI AJMERIYA,RAJKOT vs. ITO, WARD-3(1)(1), RAJKOT, RAJKOT

PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:

“1. The grounds of appeal mentioned hereunder are without prejudice to one another.

Shri Rameshbhai Chhaganbhai Ajmeriya vs. ITO Asst.Year –2017-18 - 2 - 2. The ld. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, Delhi [hereinafter referred as to the “CIT(a)] erred on facts as also in law in confirming addition of Rs.5,50,000/- on the alleged ground of failure to explain source of cash deposit of Rs.5,50,000/- in the bank account no.0003100100005003. The addition made and confirmed is totally unjustified and uncalled for which deserves to be deleted may kindly be deleted.

3. Your Honour’s appellant craves leave to add, to amend, alter, or withdraw any or more grounds of appeal on or before the hearing of appeal.”

Shri Rameshbhai Chhaganbhai Ajmeriya vs. ITO Asst.Year –2017-18 - 3 - was recorded and accordingly, the AO held that the assessee has not been able to explain the source of deposit ₹ 5,50,000/- and added same to the income of the assessee under section 69A r.w.s. 115BBE of the Act.

“5. The only issue in the appeal is addition of Rs. 5,50,000/- u/s.69 A r.w.s. 115BBE of the Act as unexplained money on the alleged ground that the appellant failed to explain source of cash deposits alongwith necessary evidences.

5.1 During the appellate proceedings, the assessee has submit his bank passbook and written submission. In the written submission, the assessee has claimed that he maintained his books of accounts. This is strange to notice that although assessee claims to have no taxable income as a professional but still has books of accounts maintained. The details of total income of the relevant year alongwith sources of income has not been provided. In the bank passbooks there are cash entries of Rs. 5,50,000/- which is the highest maximum balance available in the bank account in that year. This amount could not be treated as job work income. As there are no such other regular entries in the same bank account. The assessee has failed to substantiate its claim before AO as well as before the appellate authority. The action of the assessing officer is confirmed and appeal of the assessee is dismissed.

6. As a result, the appeal is dismissed.”

Shri Rameshbhai Chhaganbhai Ajmeriya vs. ITO Asst.Year –2017-18 - 4 - 5. Before us, the counsel for the assessee submitted that the assessee is an electrician doing job work and all income earned by the assessee is in cash. He further submitted that all relevant documents were filed by the assessee before the AO in order to substantiate the source of deposits in the assessee’s bank account. The counsel for the assessee drew our attention to page 32 of the paper book, which is the bank passbook of the assessee and submitted that there were both cash deposits as well as cash withdrawals in the assessee’s passbook. The counsel for the assessee drew our attention to the fact that even before the demonetisation period, there were substantial cash withdrawals from the assessee’s bank account. The counsel for the assessee drew our attention to page 12 of the paper book and submitted that the same was evidence to the fact that the assessee was doing miscellaneous job work as an electrician. Accordingly, the counsel for the assessee submitted that the assessee has been able to substantiate the source of cash deposits in the assessee’s bank account in the demonetisation period.