CHHAYA RAI,BN PAL RAJGARH V. ITO, FACELESS

ITA 156/AGR/2023

AI Insights

The case involves Chhaya Rai, the appellant, who contested the additions made to her income by the Income-tax Officer, Jhansi, under sections 144 and 69A of the Income-tax Act, 1961, due to unexplained cash deposits in her bank account during the demonetization period. The initial assessment added Rs.12,50,000 to her income, which was later reduced to Rs.3,27,743 by the CIT(A), considering the joint nature of the bank account and applying the peak credit method. The Tribunal dismissed her appeal, affirming that the addition was justified and that she had been adequately informed about the basis of the additions.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 473659 (ITAT-AGRA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-04-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SHAILENDER SHRIVASTAVA
• Keywords: Peak credit
• Section: 144; 69A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER AND SHRI SUNIL KUMAR SINGH, JUDICIAL MEMBER ITA No. 156/Agr/2023 Assessment Year:2017-18 Chhaya Rai, 33, BN Pal, Raigarh (UP). Vs. Income-tax Officer, Ward 2(3)(1), Jhansi. PAN :CHFPR7353P (Appellant) (Respondent) ORDER Per Annapurna Gupta, Accountant Member: The present appeal has been filed by the assessee against the order passed by the learned Commissioner of Income-tax (Appeals) [in short “CIT(A)”] u/s. 250(6) of the Income-tax Act, 1961 (hereinafter referred to as “the Act”). 2. The solitary ground raised by the assessee reads as under : “1 That the CIT(A) erred ignoring of the fact that the notice originally issued by the LD AO is in regard with the Cash deposit during the demonetization period only. Whereas the appellant had filed relevant information as asked by submitting the Copy of Bank account No 147000110083329 and a letter from the Bank where it was stated that due to some clerical mistake the appellant account was credited during Assessee by None Department by Sh. Shailender Shrivastava, Sr. DR Date of hearing 24.03.2025 Date of pronouncement 02.04.2025 ITA No.156/Agr/2023 2 | P a g e the Demonetization period by Rs 1350000/-instead of Rs 135000/-on 10.11.2016 which was corrected on the same date; However the cash so deposited in the bank account was only Rs 178000/- during the Demonetization period which relates with her husband Mr Sunil Rai who is the joint holder with the appellant who also operates it with his own business transactions and Enclosed once again the Copy of Bank a/c and Letter of Bank which was already submitted during the proceedings before the Id.AO. Thus Period taken while completing the assessment shall be the demonetization period only.” Brief facts relevant to the case are that the assessee was noted to have deposited huge cash in her bank account during the impugned assessment year including during demonetization period.The amount noted to be deposited during the demonetization period was Rs.1,78,000/- while that deposited during rest of the year was to the tune of Rs.10,72,000/-. In absence of any cooperation by the assessee during the assessment proceedings, order u/s. 144 of the Act was passed adding the entire deposits in her bank account as beingfrom unexplained sources, resulting in addition of Rs.12,50,000/- to the income of the assessee u/s. 69A of the Act. The matter was carried in appeal before the ld. CIT(A), who partly allowed the appeal of the assessee noting that the bank account was joint account of the assessee with her husband and therefore, 50% of the transactions would be attributable to her. Further, he allowed benefit of peak credit and noting that the peak of the credit balance in the bank account during the year was Rs.9,82,487/- he directed the addition to the ITA No.156/Agr/2023 3 | P a g e extent of 50% of the same to be sustainedin the hands of the assessee amounting to Rs.4,91,243/-. Since the assessee had already returned an income of Rs.1,63,500/- to tax, the balance of Rs.3,27,743/- was directed to be added to the income of the assessee, thus, resulting in reduction of the addition made to her income from Rs.12,50,000/- to Rs.3,27,743/-. The assessee is aggrieved by this order of the ld. CIT(A). None came present before us on behalf of the assessee, nor any adjournment application was filed on behalf of the assessee.The matter was therefore proceeded to be heard with exparte. Perusal of the grounds raised reveal that the assessee is aggrieved on account of the fact that the assessee was confronted with the addition proposed to be made only on account of cash deposited during the demonetization period and not otherwise and that sufficient opportunity, therefore, was not given to the assessee. The assessee in the grounds raised has contended that addition which ought to have been made was only on account of cash deposited during the demonetization period since this was the only issue which was confronted to the assessee during the assessment proceedings. We have noted from the assessment order that the assessee was show caused also with regard to the total cash deposited in her bank account ITA No.156/Agr/2023 4 | P a g e of Rs.12,50,100/-, but no response was received for the same. Therefore, we do not find any merit in the ground raised by the assessee before us seeking restriction of the addition only to the extent of cash deposited during demonetization period. The contention of the learned counsel for the assessee that it was show caused only with regard to cash deposited during the demonetization period is an incorrect fact evident from record. In view of the same, ground raised by the assessee is dismissed. Appeal of the assessee is dismissed. Order pronounced in the open court on 02.04.2025. Sd/- Sd/- (SUNIL KUMAR SINGH) (ANNAPURNA GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: *aks/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, Agra "