ARVIND KUMAR THARAD,HYDERABAD V. ITO., WARD- 6(3), HYDERABAD

ITA 243/HYD/2025

AI Insights

The case involves Shri Arvind Kumar Tharad, who appealed against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, which confirmed the addition of Rs.93,95,000 as unexplained money under section 69A of the Income Tax Act, 1961. The addition was initially made by the AO during the assessment for the A.Y. 2017-18, following the scrutiny of cash deposits made during the demonetisation period. The primary contention in the appeal was the incorrect attribution of the entire deposit in a joint bank account to the assessee alone, without considering the contributions of other joint account holders.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 779935 (ITAT-HYDERABAD)
• Duration Of Justice: 7 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-10-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-B
• Assessment Year: 2017-2018
• Appeal Filed On: 17-02-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: SACHIN KUMAR
• Assessee Lawyers: JAINENDAR
• Keywords: Opportunity of being heard; Additional evidence; Capital Gains
• Section: 143(3)

Judgement Text

" आयकर अपीलीय अधिकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘B’ Bench, Hyderabad श्री विजय पाल राि, उपाध् यक्ष एिं श्री मिुसूदन सािडिया, लेखा सदस् य क े समक्ष । BEFORE SHRI VIJAY PAL RAO, VICE PRESIDENT AND SHRI MADHUSUDAN SAWDIA, ACCOUNTANT MEMBER आ.अपी.सं /ITA No.243/Hyd/2025 (निर्धारण वर्ा/Assessment Year:2017-18) Shri Arvind Kumar Tharad, Hyderabad. PAN:ABJPT1333R Vs. Income Tax Officer, Ward-6(3), Hyderabad. (Appellant) (Respondent) निर्धाररती द्वधरध/Assessee by: Shri Jainendar, C.A. रधजस् व द्वधरध/Revenue by: Dr. Sachin Kumar, Sr. DR सुिवधई की तधरीख/Date of hearing: 13/10/2025 घोर्णध की तधरीख/Pronouncement: 15/10/2025 आदेश/ORDER PER MADHUSUDAN SAWDIA, A.M. : This appeal is filed by Shri Arvind Kumar Tharad (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)”), dated 17.09.2024 for the A.Y. 2017-18. Printed from counselvise.com ITA No.243/Hyd/2025 2 2. At the outset, it is seen that there is a delay of 79 days in filing the present appeal before this Tribunal. The assessee has filed a condonation petition along with an affidavit explaining the reasons for such delay. It is submitted that the assessee has been suffering, for a long period, from liver-related illness and cancer, resulting in prolonged hospitalisation, chemotherapy, surgeries, and continuous medical treatment. Due to this critical medical condition, the assessee was rendered physically incapacitated and mentally unfit to pursue the filing of the appeal within the prescribed time. The Learned Authorised Representative (“Ld. AR”) invited our attention to various medical reports and documents placed at page nos. 60 to 317 of the paper book, substantiating the claim of illness. It was further submitted that the delay in filing of the appeal is neither intentional nor deliberate, but purely on account of the circumstances beyond the control of the assessee. Accordingly, the Ld. AR prayed before the Bench for condonation of the delay and admission of the appeal for adjudication on merits. Printed from counselvise.com ITA No.243/Hyd/2025 3 3. Per contra, the Learned Departmental Representative (“Ld. DR”) did not raise any objection to the condonation of the delay. 4. We have considered the rival submissions and perused the material available on record. Further, considering the medical reasons supported by documentary evidence and the fact that there was no mala fide intention behind the delay, we are satisfied that sufficient cause has been shown for not filing the appeal within the prescribed period. Accordingly, the delay of 79 days is condoned, and the appeal is admitted for adjudication on merits. 5. The assessee has raised the following grounds of appeal : Printed from counselvise.com ITA No.243/Hyd/2025 4 6. The brief facts of the case are that, the assessee is an individual who filed his return of income for the Assessment Year 2017–18 on 01.08.2017, admitting income from capital gains and other sources. The case of the assessee was selected for scrutiny through CASS, and accordingly, a notice under section 143(2) of the Income Tax Act, 1961 (“the Act”) was issued to the assessee on 21.09.2018. During the course Printed from counselvise.com ITA No.243/Hyd/2025 5 of assessment proceedings, the Learned Assessing Officer (“Ld. AO”) observed that the assessee had deposited cash amounting to Rs.93,95,000/- in six different bank accounts during the demonetisation period (09.11.2016 to 30.12.2016). The Ld. AO called upon the assessee to explain the source of the said cash deposits. However, being not satisfied with the explanation offered, the Ld. AO treated the entire cash deposit of Rs.93,95,000/- as unexplained money under section 69A of the Act, and added the same in the hands of the assessee. Accordingly, the Ld. AO completed the assessment under section 143(3) of the Act on 06.12.2019 after making the addition of Rs.93,95,000/- under section 69A of the Act. 7. Aggrieved by the order of the Ld. AO, the assessee preferred an appeal before the Ld. CIT(A). The Ld. CIT(A), however, did not find merit in the submissions of the assessee and confirmed the addition made by the Ld. Assessing Officer, thereby dismissing the appeal of the assessee. Printed from counselvise.com ITA No.243/Hyd/2025 6 8. Aggrieved by the order of the Ld. CIT(A), the assessee is in further appeal before this Tribunal. The Ld. AR submitted that the solitary issue out of the grounds of the assessee is against the addition of Rs.93,95,000/- made by the Ld. AO under section 69A of the Act. The argument of Ld. AR on this issue where many folds. With regard to one of its argument, the Ld. AR submitted that, the bank accounts considered by the Ld. AO for making addition under section 69A of the Act is joint account held by five persons, including the assessee. It was contended that the deposits made into the said joint bank account represent the collective funds of all the joint holders, and not solely that of the assessee. The Ld. AR drew our attention to the certificate issued by the bank, placed at page no.322 of the paper book, certifying that account number 34130400000049 is held jointly in the names of five individuals, including the assessee. He submitted that the Ld. AO, without appreciating the joint ownership of the account, erroneously taxed the entire deposit in the hands of the assessee. It was, therefore, prayed that appropriate verification be directed to Printed from counselvise.com ITA No.243/Hyd/2025 7 determine the proportionate ownership and corresponding taxability of the deposits. 9. Per contra, the Ld. DR strongly objected to the new claim of the assessee. He submitted that this contention was neither raised before the Ld. AO nor before the Ld. CIT(A). Therefore, the assessee should not be permitted to raise such a factual plea for the first time before the Tribunal, which requires fresh verification and is beyond the scope of record. The Ld. DR accordingly argued that this contention of the assessee is liable to be rejected. 10. We have considered the rival submissions and perused the material available on record. We have gone through the certificate issued by the bank, placed at page no.322 of the paper book, which is to the following effect : Printed from counselvise.com ITA No.243/Hyd/2025 8 11. On perusal of above, we found that the bank account number 34130400000049 is a joint account held by five persons, including the assessee. We have also gone through the details of cash deposited in various bank accounts of the assessee which has been captured by the Ld. AO at para no.4 of his assessment order, which is to the following effect : Printed from counselvise.com ITA No.243/Hyd/2025 9 12. On perusal of above, we found that the major cash deposits of Rs.68,95,000/- has been made by the assessee in the bank account number 34130400000049 which is a joint account held by five persons, including the assessee. However, the Ld. AO, while making the addition under section 69A of the Act, has treated the entire cash deposits as unexplained money belonging solely to the assessee, without examining the aspect of joint ownership. We note that though the assessee has raised this contention for the first time before Printed from counselvise.com ITA No.243/Hyd/2025 10 this Tribunal, the fact of joint ownership of the bank account arises from the record already available before the lower authorities. Therefore, in our considered view, if the fact arises from the record already available before the lower authorities, the Tribunal is empowered to entertain such a ground, even if not raised earlier, when it is necessary to determine the correct tax liability. However, since the determination of ownership and proportionate contribution of each joint holder involves factual verification, which was not undertaken by the lower authorities, we deem it appropriate to restore this issue to the file of the Ld. AO for fresh examination. The Ld. AO shall verify the ownership and extent of the assessee’s share in the total cash deposits and decide the issue de novo, after affording adequate opportunity of being heard to the assessee. The assessee shall also be at liberty to file additional evidence, if any, in support of his claim. 13. Further, in our considered view it is essential to first determine the ownership of cash deposited in the joint bank account and ascertain how much of the cash deposit actually Printed from counselvise.com ITA No.243/Hyd/2025 11 belong to the assessee. Without finalising this foundational aspect, the other alternative issues raised by the assessee cannot be effectively adjudicated. Since the foundational aspect is being restored to the file of the Ld. AO for de novo verification, we do not propose to adjudicate on the other alternative grounds raised by the assessee. 14. In the result, the appeal is allowed for statistical purposes. Order pronounced in the open Court on 15th Oct., 2025. Sd/- Sd/- (VIJAY PAL RAO) (MADHUSUDAN SAWDIA) VICE PRESIDENT ACCOUNTANT MEMBER Hyderabad. Dated: 15.10.2025. * Reddy gp Copy of the Order forwarded to : 1. Shri Arvind Kumar Tharad, 6-3-1176/1, B S Maktha Begumpet, Hyderabad-500 016 2. The ITO, Ward 6(3), Hyderabad. 3. Pr.CIT, Hyderabad. 4. DR, ITAT, Hyderabad. 5. Guard file. BY ORDER, Printed from counselvise.com "