Case Number: ITA 1764/DEL/2020
Appellant: Gunjan Gupta, New Delhi
Respondent: ITO WARD – 1(3), Ghaziabad
Assessment Year: 2008-09
Case Filed On: 2020-10-23
Order Type: Final Tribunal Order
Date of Order: 2022-02-18
Pronounced On: 2022-02-18
This appeal, numbered ITA 1764/DEL/2020, was filed by Gunjan Gupta against the order dated 26.08.2020 of the Commissioner of Income Tax (Appeals), Ghaziabad, concerning the assessment year 2008-09. The appellant contested the reopening of assessment and the addition of cash deposits by the Assessing Officer (AO).
The case was heard by the Delhi “SMC” Bench of the Income Tax Appellate Tribunal (ITAT) on January 24, 2022, with the order pronounced on February 18, 2022. The bench comprised Judicial Member Shri Kul Bharat.
The primary grounds of appeal were:
Gunjan Gupta filed his return of income for the assessment year 2008-09 on March 12, 2009, declaring an income of Rs.1,97,450. The case was reopened for assessment under Section 147 of the Income Tax Act, 1961, based on AIR information that the assessee deposited cash of Rs.11,41,500 in his savings bank account during the year. Despite several notices, the assessee did not respond, leading to an ex parte assessment under Section 144 of the Act, where the AO made an addition of Rs.7,01,500.
The appellant argued that the AO had insufficient grounds to reopen the assessment based solely on the information of cash deposits. The appellant further claimed that proper procedures for serving notices were not followed, rendering the assessment proceedings invalid. Additionally, the appellant contested the addition of Rs.7,01,500, stating that the deposits were justified through withdrawals and other sources.
The ITAT examined the grounds of appeal and the evidence presented:
The tribunal found that the AO had the authority to verify the source of cash deposits, and thus, the reopening of the case was justified. Ground Nos. 1 to 4 of the appellant’s appeal were dismissed.
The appellant provided a detailed explanation of the cash deposits, supported by evidence such as bank statements, audit reports, and capital accounts. The tribunal noted that the AO did not provide evidence to suggest that the withdrawn amounts were used elsewhere. Therefore, the tribunal directed the AO to delete the addition of Rs.7,01,500. Ground No. 5 of the appellant’s appeal was allowed.
The tribunal held that the charging of interest under Sections 234B and 234C is consequential in nature. Ground Nos. 6 and 7 were dismissed.
The appeal by Gunjan Gupta was partly allowed. The tribunal upheld the reopening of the assessment but directed the deletion of the addition of Rs.7,01,500 on account of cash deposits. The appeal regarding the charging of interest was dismissed as consequential.
The tribunal’s order was pronounced in the open court on February 18, 2022, by Judicial Member Shri Kul Bharat.
Member: Shri Kul Bharat, Judicial Member
Copy forwarded to:
Gunjan Gupta vs. ITO Ward-1(3), Ghaziabad – 2008-09 – Reopening Assessment for Cash Deposits
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