Income Tax Appeal Case ITA 1735/DEL/2022: Bijender Lather Vs ITO, Sonipat for Assessment Year 2017-18

Income Tax Appellate Tribunal Delhi’s Verdict on ITA 1735/DEL/2022

On 23rd February 2023, the Income Tax Appellate Tribunal, Delhi Bench, delivered a significant judgment in the case of Bijender Lather, the appellant, versus Income Tax Officer (ITO), Ward-1, Sonipat, the respondent, concerning the assessment year 2017-18. The case, bearing the number ITA 1735/DEL/2022, culminated in a decision that allowed the appeal lodged by Bijender Lather, hereby setting a critical precedent in income tax litigation.

Background of the Case

The appellant, Bijender Lather of 5/6, Railway Colony, Gohana, Haryana, contested against the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (“NFAC”), Delhi dated 30th May 2022. The grounds for appeal arose from the appellant’s dissatisfaction with the assessment order under section 144 of the Income Tax Act, 1961, and the resultant additions made to his income regarding cash deposits during the specific period between 09 November 2016 and 31 December 2016.

Specifically, the issue at hand was the addition of Rs.564,500 out of total cash deposits amounting to Rs.1,264,500 during the said period. The appellant challenged the order on several grounds, chiefly arguing a lack of reasonable opportunity to present his case, and contending the additions were unjustified on the basis of the evidence he provided.

Evidence and Arguments Presented

During the tribunal hearing, Bijender Lather, through his legal representation, provided a detailed cash flow statement to substantiate his position. This document aimed to clarify the nature and source of the cash deposits, traced back to legitimate agricultural activities and withdrawals from Kisan Credit Card (KCC) accounts, painting a comprehensive picture of his financial transactions throughout the relevant times.

The prosecution and defense exchanged arguments regarding the validity of the appellant’s evidence and his compliance with procedural norms. The defense argued that the assessment order under section 144 failed to consider the appellant’s explanations and documentation, which demonstrated a legitimate source of the cash deposits.

Judgment and Conclusion

In a detailed judgment, Shri Kul Bharat, Judicial Member, took into consideration the cash flow statement and the arguments made. It was determined that the assessee had indeed provided sufficient evidence to justify the source of the cash deposits. Consequently, the tribunal found the addition made by the Assessing Officer and upheld by the CIT(Appeals) to be unjustified, leading to the direction for its deletion.

The ruling thus favored Bijender Lather, allowing the appeal and setting aside the additions made to his income, marking a noteworthy judgment in the landscape of income tax appeals. The decision underscored the importance of providing assessees a fair chance to present their case and the need for the taxation authorities to consider substantial evidence before making additions.

In conclusion, the tribunal’s decision in ITA No.1735/Del/2022 serves as a significant benchmark for similar cases, emphasizing the critical analysis required in scrutinizing the merits of tax assessments and appeals. The final judgment rendered vindicates Bijender Lather’s stance, allowing the appeal on the grounds stated.

Income Tax Appeal Case ITA 1735/DEL/2022: Bijender Lather Vs ITO, Sonipat for Assessment Year 2017-18