Case Number: ITA 416/DEL/2019
Appellant: Balraj Singh, Meerut
Respondent: ITO, Ward-1(2), Meerut
Assessment Year: 2010-11
Case Filed On: 2019-01-21
Order Type: Final Tribunal Order
Date of Order: 2019-10-18
Pronounced On: 2019-10-18
Balraj Singh, a resident of Meerut, filed an appeal against the order dated 26.11.2018 of the Learned Commissioner of Income-Tax (Appeals), Meerut, pertaining to the assessment year 2010-11. The primary issue in the appeal was the addition of Rs.23,26,060/- on account of cash deposits in the appellant’s Savings Bank Account, which the Income Tax Officer (ITO) treated as income from undisclosed sources.
The case was heard by the Delhi Bench “F” of the Income Tax Appellate Tribunal (ITAT), presided over by Shri Amit Shukla, Judicial Member, and Shri Prashant Maharishi, Accountant Member. The appellant was represented by Shri Chander Mehra, FCA, while the respondent was represented by Shri S.L. Anuragi, Senior Departmental Representative (Sr. DR).
The ITO had received AIR information from CIB, Kanpur, indicating that the appellant had deposited cash of Rs.40,65,117/- in his Savings Bank Account with Union Bank of India during the Financial Year 2009-10. Due to the absence of an explanation for the source of these cash deposits, the ITO issued a notice under Section 148 of the Income Tax Act, 1961, on 21.03.2017, initiating reassessment proceedings. Despite multiple statutory notices, the appellant failed to respond, leading the ITO to complete the assessment under Section 144, making an addition of Rs.40,65,117/- as income from undisclosed sources.
Before the CIT(A), the appellant submitted additional evidence, including details of agricultural holdings, affidavits from his brothers, and financial documents of his brother, Shri Raghuraj Singh, who operated a toll collection business. The CIT(A) forwarded these evidences to the ITO, who provided a remand report. Despite this, the CIT(A) upheld the ITO’s addition, disbelieving the appellant’s explanation regarding the source of the cash deposits.
During the hearing at the ITAT, the appellant’s counsel argued that the cash deposits in question were from the toll collection business operated by the appellant’s brother, Shri Raghuraj Singh. The appellant presented audited financial statements of his brother’s business, showing substantial toll collections and corresponding expenses. The counsel contended that the cash deposits were adequately explained and documented.
The Tribunal observed that the CIT(A) had not adequately examined the appellant’s evidence or the cash flow related to the toll collection business. The Tribunal noted that the CIT(A) failed to consider the day-to-day cash deposits in the bank account in the context of the toll business’s financial records.
Given these observations, the Tribunal remanded the case back to the ITO for a fresh examination of the appellant’s submissions and additional evidence. The ITO was directed to consider all evidence and verify the cash deposits against the financial records of the appellant’s brother’s toll collection business. The Tribunal emphasized the need for a detailed and thorough examination of the facts and directed the ITO to provide the appellant with an opportunity to be heard.
The Tribunal allowed the appeal filed by Balraj Singh for statistical purposes, remanding the case back to the ITO for a fresh examination of the evidence provided by the appellant. The decision was pronounced in the open court on 18th October, 2019.
Members of the Tribunal:
Shri Amit Shukla, Judicial Member
Shri Prashant Maharishi, Accountant Member
For more information on similar cases and legal precedents, visit the official website of the Income Tax Appellate Tribunal of India.
Balraj Singh vs ITO: Dispute Over Cash Deposits in Savings Bank Account – ITA 416/DEL/2019
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