Case Number: ITA 5459/DEL/2019
Appellant: Sobh Ram, Panipat
Respondent: ITO Ward-4, Panipat
Assessment Year: 2010-11
Result: Final Tribunal Order
Case Filed on: 2019-06-20
Date of Order: 2022-05-27
Pronounced on: 2022-05-27
The case between Sobh Ram and the Income Tax Officer of Ward-4, Panipat revolves around unexplained deposits made into Sobh Ram’s bank account, which were added as taxable income by the Income Tax Department for the assessment year 2010-11.
The issue began with a scrutiny assessment that identified several unexplained cash deposits in Sobh Ram’s bank account. The assessing officer, citing lack of adequate explanation or evidence from Sobh Ram regarding the source of these deposits, added them to his taxable income.
Sobh Ram appealed to the CIT(A), but the lack of cooperation and insufficient evidence led to the upholding of the additions by the CIT(A). Dissatisfied with the decision, Sobh Ram escalated the matter to the Income Tax Appellate Tribunal.
The Tribunal, upon reviewing the case, found that the tax authorities had not conducted adequate enquiries to discredit Sobh Ram’s claims about the nature of the deposits. Notably, Sobh Ram argued that the money was agricultural income received from his father-in-law, a resident of Canada, for which he was merely a custodian.
The Tribunal set aside the CIT(A)’s decision, allowing Sobh Ram’s appeal. It emphasized that presumptions of honesty should apply unless there is substantial evidence to the contrary, and noted the difficulty in maintaining records for small amounts over long periods. This decision underlined the importance of thorough investigation and fair assessment in tax proceedings.
Order pronounced in the open court on 27th May, 2022.
Signatories:
B.R.R. Kumar, Accountant Member
Anubhav Sharma, Judicial Member
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