LUZITO SEBASTIAO RODRIGUES,SALCETE vs. ITO, INT. TXN. WARD`, PANAJI

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ITA 12/PAN/2022Status: DisposedITAT Panaji30 January 2023AY 2017-18Bench: SHRI SATBEER SINGH GODARA (Judicial Member)4 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal found that the lower authorities had not fully accounted for the assessee's cash withdrawals. Therefore, a lump sum addition of Rs. 2,50,000 out of the Rs. 5,38,000 in issue was deemed just and proper.

What were the facts?

The assessee appealed against the addition of Rs. 5,38,000 as unexplained cash deposit during demonetization and the subsequent tax and interest levied. The Assessing Officer had made an addition after considering cash deposits and withdrawals, and giving credit for amounts related to the assessee's son-in-law.

What were the issues?

Whether the entire cash deposit of Rs. 5,38,000 was unexplained money, and if so, whether it should be taxed at 60% under Section 115BBE.

Which sections of the Income-tax Act were involved?

Section 69A,Section 115BBE,Section 234B,Section 234C,Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PANAJI ‘SMC’ BENCH : PANAJI

Before: SHRI SATBEER SINGH GODARA

Hearing: 30.01.2023Pronounced: 30.01.2023

ORDER This assessee’s appeal for assessment year 2017- 18, arises against the CIT(A)-12, Bengaluru’s order dated 10.02.2022, passed in case ITA.No.10154/CIT(A)-12/2019-20, in proceedings u/s. 143(3) of the Income Tax Act, 1961 (in short "the Act").

Heard both the parties. Case file perused.

2.

The assessee pleads the following substantive grounds in the instant appeal :

1.

“The Ld. CIT(A) erred in upholding the action of the Ld. AO in adding cash deposit of Rs.5,38,000/- as unexplained money u/s 69A of the Income-tax Act, 1961 (The Act'). The 2 ITA.No.12/PAN/2022 reasons given in this regard are patently erroneous and unjustified.

1.

2. The Ld. CIT(A) erred in upholding the action of the Ld. AO in taxing such cash deposit of Rs.5,38,000/- u/s 115BBE of the Act at the rate of 60%.

3.

The Ld. CIT(A) erred in upholding the levy of interest u/s 234B and 234C of the Act.

4. The Ld. CIT(A) erred in not setting aside the action of the Ld. AO in initiating penalty proceedings u/s 271(1)(c) of the Act.

5. The appellant craves leave to add, to amend, alter/delete and/or modify the above grounds of appeal on or before the final hearing.”

3. It is thus clear that the assessee’s sole substantive ground pleaded in the instant appeal seeks to reverse both the lower authorities action treating the cash deposits of Rs.5.38 lakhs during demonetization period as unexplained u/s.69A of the Act. A perusal of the case file, and more particularly, the CIT(A)'s detailed discussion in para-9 page-8 suggests that he has nowhere doubted the “wherewithal” of the assessee having earned the sum in issue from an overseas employment on a monthly salary of about $5000.

3.1. It is further evident from the Assessing Officer’s detailed discussion at page-4 para-5, that he had only given a 3 ITA.No.12/PAN/2022 credit of Rs.10,01,830/- involving assessee’s son-in-law so far as the former’s total cash deposits of Rs.15,39,830/- are concerned.

4.

Ld. Departmental Representative could hardly dispute that both the lower authorities have nowhere granted credit of assessee’s cash withdrawals almost exceeding Rs.12 lakhs right from 01.04.2015 till demonetization. The fact also remains that assessee has also not filed all the relevant details of his house hold expenditure vis-à-vis foregoing withdrawals so as to attribute source of these cash deposits. Faced with the situation, I deem it appropriate that a lump sum addition of Rs.2,50,000/- out of that in issue of Rs.5.38 lakhs would be just and proper with a rider that the same shall not be treated as a precedent. Necessary computation shall follow as per law.

5.

No other ground has been argued or pressed during the course of hearing.

6.

This assessee’s appeal is partly allowed in above terms.

Order pronounced in the open court on 30.01.2023.

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