This case involves Sangeet Gupta from New Delhi as the appellant against the Income Tax Officer, Ward-62(4), New Delhi. It centers around a dispute over bank deposits amounting to Rs. 2,80,000 for the assessment year 2010-11, contested by the appellant against the order of the Commissioner of Income Tax (Appeals) -20, New Delhi dated August 30, 2018.
The bench, led by Sh. T. S. Kapoor, Accountant Member, heard the appeal on May 28, 2019, with the final judgment pronounced on May 31, 2019. The appellant was represented by Smt. Rano Jain, Advocate, and Sh. Pranshu Singhal, CA, while the respondent’s case was handled by Sh. S. L. Anuragi, Sr. DR.
The primary focus of the dispute was the addition of Rs. 2,80,000 made by the Assessing Officer on account of deposits in the appellant’s bank account. The appellant argued that these deposits were made from withdrawals noted earlier in March 2010, suggesting these funds were legitimately in hand. Notably, the CIT(A) had acknowledged these withdrawals but upheld the addition, assuming the withdrawn amounts were used for business purposes rather than kept as cash-in-hand.
The ITAT found that the withdrawals made by the appellant were sufficient to cover the deposits in question. There was no evidence presented by the tax authorities to suggest these funds were allocated for specific uses other than what the appellant claimed. This led to the tribunal allowing the appeal in favor of Sangeet Gupta, emphasizing the need for concrete evidence before making additions based on assumptions about the use of withdrawn funds.
This decision underscores the importance of proper documentation and the burden on tax authorities to substantiate their claims with clear evidence. It serves as a precedent for similar cases where the source of funds is disputed by the tax authorities based on presumptions rather than factual proof.
The tribunal’s ruling in favor of the appellant in ITA 121/DEL/2019 provides significant relief to Sangeet Gupta and sets a critical judicial precedent on handling cases involving the tracing of deposits to prior withdrawals. The decision highlights the importance of detailed financial records and the necessity for tax authorities to base additions on concrete evidence.
Sangeet Gupta vs ITO, Ward-62(4), New Delhi on Bank Deposit Dispute for AY 2010-11
Manage the increasing number of hearings effortlessly by leveraging the legal AI revolution We are India's Leading revolutionary AI-powered legal platform where you can get enough insights into top cases and judgements.
Research Platform