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Income Tax Appellate Tribunal, DELHI BENCH “A”: NEW DELHI
Before: SHRI SHAMIM YAHYA & MS. ASTHA CHANDRA
Bimal Krishan Sareen, Vs. ACIT, N-94, GF-2, Central Circle-26, Panchsheel Park, New Delhi. New Delhi 110 017. PAN AQJPS3852H (Appellant) (Respondent) Assessee by: Shri R K Bansal, CA Department by : Shri Kanv Bali, Sr. DR Date of Hearing 20.03.2023 Date of pronouncement 19.04.2023 O R D E R PER ASTHA CHANDRA, JM The appeal filed by the assessee is directed against the order of the Ld. Commissioner of Income Tax (Appeals) - 31, New Delhi (“CIT(A)”) dated 30.06.2022 pertaining to the Assessment Year (“AY”) 2017-18.
The assessee has taken the following grounds of appeal: - “1. The learned Commissioner of Income Tax (Appeals) has erred in confirming the addition of Rs.2000000 under section 69A of the Income Tax Act 1961 made by the assessing officer on account of cash found during search in lockers of the assessee. As the cash was saved out of cash withdrawls made from banks and gifts received from parents, relatives on various occasions over the past many years.
2. The Commissioner of Income Tax (Appeals) erred in confirming the penalty proceedings initiated by the assessing officer under section 271 AAB of the Income Tax Act 1961.”
The facts in brief are that the assessee is an individual who derived income from salary, capital gain and other sources. He filed his return for AY 2017-18 on 31.03.2018 declaring income of Rs. 44,830/-. Subsequently, search and seizure operation under section 132 of the Income Tax Act, 1961 (the “Act”) was carried out in the case of Sanjay Bhandari/OIS group of cases on 27.04.2016 and the case of the assessee was also covered in the search. During the course of search operation, cash of Rs. 20 lakhs and jewellery of Rs. 71,19,587/- were seized. During assessment proceedings, the Ld. Assessing Officer (“AO”) required the assessee to explain the source of said cash and jewellery. The explanation offered by the assessee was not acceptable to the Ld. AO who added Rs. 20 lakhs under section 69A of the Act as unexplained cash on substantive basis and made an addition of Rs. 71,19,587/- being value of unexplained jewellery on protective basis in the hands of the assessee in the assessment framed under section 153A/143(3) of the Act on 21.12.2018.
Aggrieved, the assessee filed appeal before the Ld. CIT(A) challenging the additions made by the Ld. AO. Notices of hearing sent by the Ld. CIT(A) remained uncomplied with. In appellate order No. 867/20-21 dated 29.06.2022 the Ld. CIT(A) upheld the addition of unexplained jewellery of Rs. 71,19,587/- in the hands of Smt. Soni Sareen, wife of the assessee on substantive basis and therefore, deleted the protective addition of Rs. 71,19,587/- in the hands of the assessee. The Ld. CIT(A) however, upheld the addition of unexplained cash of Rs. 20 lakhs by observing in para 6.2 of his appellate order as under:-
“6.2. Ground no. 2 is regarding addition u/s 69 amounting to Rs. 20,00,000/- of on account of cash found in various lockers in the name of assessee and his wife, Smt. Sony Sareen. The AO noted that neither the assessee himself nor Smt. Sony Sareen, wife of assessee, explained with documentary evidence of source of cash amounting to Rs. 2,00,000/- found in locker No. 2569, Alaknanda Vaults Pvt. Ltd., Rs 3,00,000/- found in locker No. 189, HDFC Bank Sector-21C, Faridabad and Rs. 15,00,000/- was found in locker no. 1633, Jay Safe Vault, E-ll, Kailash Colony, New Delhi in the name of assessee and Smt. Sony Sareen. In his statement, the assessee stated that the cash found represents savings of the family. The same stand has been taken in assessment proceedings without giving any evidences regarding the same. Therefore, source of cash found in search was un-explained. I have considered the facts of the case and find the appellant has not able to submit anything during the appellate proceedings to controvert the findings that the cash found amounting to Rs.20.00.000/- belongs to the appellant and is un-accounted. Therefore, in the absence of any explanation or evidence to the contrary, the addition of Rs. 20.00.000/- is upheld. Hence, Ground no. 2 is hereby dismissed.”
Dissatisfied, the assessee challenged the confirmation of addition of unexplained cash of Rs. 20 lakhs by the Ld. CIT(A) and ground No. 1 relate thereto.
The Ld. AR submitted that the assessee saved the cash in question out of bank withdrawls over a period of years and was kept for emergency medical treatment for his family and parents. Both the parents of the assessee were super senior citizens at the time of search and now deceased. It is, therefore, natural that the possession of cash in question is reasonable and justified.
The Ld. DR supported the orders of the Ld. AO/CIT(A). He emphasised that no documentary evidence was produced in support of the explanation either before the Ld. AO or before the Ld. CIT(A).
We have heard the Ld. Representative of the parties, considered their rival submissions and perused the records. It is a case of search conducted under section 132 of the Act on 27.04.2016. During the search operations the cash amounting in all to Rs. 20 lakhs were found from three different lockers in the name of the assessee and his wife. The explanation given was that the cash found represents savings of the family. However, no evidence in support was produced either during assessment proceedings before the Ld. AO nor before the Ld. CIT(A) in appeal proceedings. No evidence has been led before us also. On these facts and circumstances of the case we concur with the observations and findings of the Ld. CIT(A). In the absence of any evidence brought on record in support of the submissions made by the assessee, we decline to interfere. Accordingly, ground No. 1 is decided against the assessee.
Ground No. 2 relates to initiation of penalty proceedings under section 271AAB of the Act. This being pre-mature, does not require adjudication at this stage. Ground No. 2 is therefore, rejected.
In the result, appeal of the assessee is dismissed.