AIDANSINGH LALSINGHJI RAJPUT,MUMBAI V. INCOME TAX OFFICER WARD, 2(1), THANE

ITA 4048/MUM/2024

AI Insights

The case involves Aidansingh Lalsinghji Rajput, who appealed against the order of the CIT(A) Panaji, which had confirmed the addition of unexplained cash deposits during the demonetization period to his income for the Assessment Year 2017-18. The Income Tax Officer (ITO) had initially added the entire amount of Rs.5,49,500 as unexplained, but upon appeal, the CIT(A) upheld this decision. The ITAT, however, found that part of the cash deposit could be explained as rental income from a property (Gala) in Vasai, which the assessee had rented out. The Tribunal accepted the rental income for the periods for which it was documented and reduced the addition to the extent of Rs.1,77,500, which was considered unexplained.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 34427 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: H
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: UODAL RAJ SINGH
• Assessee Lawyers: BHARAT KUMAR
• Keywords: Business income
• Section: 250

Judgement Text

"P a g e | 1 ITA No.4048/Mum/2024 Aidansingh Lalsinghji Rajput IN THE INCOME TAX APPELLATE TRIBUNAL “H(SMC)” BENCH, MUMBAI BEFORE SHRI AMARJIT SINGH, ACCOUNTANT MEMBER & SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER ITA No.4048/Mum/2024 (A.Y.2017-18) Aidansingh Lalsinghji Rajput, D/8, Sujata Shopping Centre, Navghar Road Bhayandar East, Thane, Maharashtra – 401105 Vs. ITO, Ward 2(1) Income Tax Office, Quereshi Mansion, Gokhale Road, Naupada, Thane West, Thane Maharashtra – 400602 \u0001थायी लेखा सं./जीआइआर सं./PAN/GIR No. AEUPR5534E Appellant .. Respondent Appellant by : Shri Bharat Kumar, CA Respondent by : Shri Uodal Raj Singh, Sr. DR Date of Hearing 05.11.2024 Date of Pronouncement 09.01.2025 आदेश / O R D E R Per Amarjit Singh (AM): The appeal filed by the assessee is directed against the order of Ld. CIT/ADDL/JCIT(A) Panaji passed u/s 250 of the Act dated 19.06.2024 for A.Y. 2017-18. 2. Fact in brief is that return of income declaring total income of Rs.8,30,670/- was filed on 21.12.2017. The case was subject to scrutiny assessment on 21.09.2018. During the course of assessment the AO noticed that assessee has deposited cash of Rs.5,49,500/- during the demonetization period in his account. On query, the assessee explained that the source of cash deposit was out of earlier years’ P a g e | 2 ITA No.4048/Mum/2024 Aidansingh Lalsinghji Rajput savings earned from business income and rental income. The assessee has filed copies of balance sheet as on 31.03.2015 and on 31.03.2016 along with copies of cash books for the period 01.04.2016 to 31.03.2017. In his submission, the assessee submitted that he has given rent for Gala at Vasai from which he received rent of Rs.12,000/- per month aggregating to Rs.1,44,000/- in a year. The AO stated that cash in hand shown by the assessee of Rs.8,95,423/- was not reflected in the ITR for assessment year 2015-16 and 2016-17, however, the AO has accepted the submission of the assessee of receiving rent of Rs.12,000/- per month from the Gala till 08.11.2016, therefore, restricted the addition to the extent of Rs.4,65,500/-. 3. The assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has dismissed the appeal of the assessee reiterating the facts stated by the assessing officer. 4. Heard both the sides and perused the material on record. Without reiterating the facts as discussed above the AO has not disputed the receipt of rent from the Gala only for the period of 01.04.2016 to October 2016. The assessee had filed copies of balance sheet, capital account, and ITR acknowledgment for the assessment year 2013-14 to 2015-16 and 2016-17 before the lower authorities showing that he has been receiving compensation for giving Gala on rent. The assessee also submitted that there was no column in Income Tax Return filed in Form 3 to show the cash in hand at the end of the year, therefore, the same was not reflected in the Income Tax Return. As discussed the AO has not disputed the fact that assessee has provided the Gala on rent, in fact accepted the part of rent income received during the year for giving on rent in cash as source of cash deposited in the bank account. The assessee has reported the compensation for giving of Gala on rent from Assessment Year 2014-15 to 2017-18 as per copies of balance sheet P a g e | 3 ITA No.4048/Mum/2024 Aidansingh Lalsinghji Rajput cash book, ledger a/c etc. filed in support of the income reflected in the return of income filed. However, the AO had not controverted these facts by conducting any enquiry from the tenants to whom the gala was provided on rent. Therefore, of rental income earned in assessment year 2014-15 of Rs.1,44,000/- (+) Rs.1,44,000 for AY: 2016-17 (+) Rs.84,000/- for the period of deposit accepted in the assessment year 2107-18 totaling to Rs.3,72,000/- is considered as deposited out of the cash received from giving Gala on rent and addition of unexplained cash is restricted to the extent of Rs.1,77,500/-. Therefore, appeal of the assessee is partly allowed. 5. In the result, the appeal of the assessee is partly allowed. Order pronounced in the open court on 09.01.2025 Sd/- Sd/- (Rahul Chaudhary) (Amarjit Singh) Judicial Member Accountant Member Place: Mumbai Date 09.01.2025 Rohit: PS आदेश की \bितिलिप अ\u000eेिषत/Copy of the Order forwarded to : 1. अपीलाथ\u0014 / The Appellant 2. \u0016\u0017थ\u0014 / The Respondent. 3. आयकर आयु\u001a / CIT 4. िवभागीय \u0016ितिनिध, आयकर अपीलीय अिधकरण DR, ITAT, Mumbai 5. गाड$ फाईल / Guard file. स\u0017ािपत \u0016ित //True Copy// आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण/ ITAT, Bench, Mumbai. "