Faljibhai Laljibhai Chaudhari Legal hair of late Laljibhai V Chaudhari, Banskantha V. The ITO, Ward-4, Palanpur

ITA 1890/AHD/2019

AI Insights

The case involves Faljibhai Laljibhai Chaudhari, an agriculturist, who appealed against the orders of the CIT(A) and the Assessing Officer regarding additions made to his income for the Assessment Year 2011-12. The additions were based on unexplained cash deposits of Rs. 34,63,500 in his bank account, which the Assessing Officer attributed to undisclosed income. The assessee argued that these deposits were from his legitimate agricultural and milk sales income, which were not properly considered by the lower authorities. The Tribunal found that the assessee had regularly deposited cash from his income sources and had also made regular withdrawals, indicating that the cash deposits were from legitimate sources. The Tribunal's decision highlighted the need for a thorough consideration of the evidences provided by the assessee, leading to the allowance of the appeal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 300005 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 27-02-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 25-12-2019
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 147; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD BEFORE MS. SUCHITRA KAMBLE, JUDICIAL MEMBER I. T .A . N o .1 89 0 / Ah d/2 0 1 9 ( A s se ss m e nt Y e a r : 20 11- 12 ) Falj i b h ai L alj ib h a i C h a u dh a r i ( L/ h. o f La lj i bh a i V . C h a u d ha r i ) C h au dha r i V a s , Edr an a , B a na s ka n t ha -3 85 2 1 0 V s . I T O, War d - 4 , Pa l an p u r [P AN N o.B U QP C 1 10 5 D] (Appellant) .. (Respondent) Appellant by : Shri Taj Shah, A.R. Respondent by: Shri R. R. Makwana, Sr. D.R. D a t e of H ea r i ng 15.03.2023 D a t e of P r o no u n ce me nt 29.03.2023 O R D E R The appeal filed by the assessee is against the order passed by the Ld. CIT(Appeals)-4, Ahmedabad on 18.10.2019 for A.Y. 2011-12. 2. The grounds of appeal raised by the assessee are as under: “1. The Ld. CIT(A) has erred in law and in the facts of the case in confirming the order of the Ld. AO making addition Amt of Rs. 34,63,500 as cash deposited in bank account in saving bank account and minor interest income Amt of Rs. 4,271/- add in total income and finalized the assessment order. 2. The Assessment made is bad in law, invalid and illegal. It be so held now and the same be quashed. 3. Direction to charge interest u/s. 234A,B & C without application of mind is unjustified. It be so held now. 4. The Assessment made on the asessees U/s. 147 of act in bad in law, where no notice U/s. 148 was not served properly to the assessee which is served on same person living in Chhapi Village. 5. That the appellant craves leave to add, to alter, to amend, to modify, to Substitute, delete and/or rescind all or any of the GROUNDS OF APPEALS on or before the final hearing, if necessary so arises.” 3. The assessee is an agriculturist and having income from agricultural produce, Milk income and saving bank interest. The assessee has not filed return of income for A.Y. 2011-12. The Assessing Officer after receiving information observed that the assessee has deposited huge cash of Rs. ITA No. 1890/Ahd/2019 Faljibhai Laljibhai Chaudhari vs. ITO Asst.Year–2011-12 - 2 - 34,63,500/- in his saving bank account maintained with the Chhapi Nagrik Bank Ltd. during the Financial Year 2010-11. The case of the assessee was reopened under Section 147 of the Income Tax Act, 1961 and after recording reasons, notice under Section 148 of the Act was issued on 28.03.2018 and the same was served upon the assessee on 30.03.2018. But the assessee did not responded the notices and therefore, the Assessing Officer finalized the assessment under Section 144 of the Act thereby making addition of Rs. 34,67,771/- towards unexplained cash deposits. 4. Being aggrieved by the Assessment order, the assessee filed appeal before the CIT(A). The CIT(A) partly allowed the appeal of the assessee. 5. The Ld. AR submitted that the assessee is an agriculturist and derives income from agricultural produce as well as milk. The Ld. AR submitted that the assessee mainly gets paid in cash on daily basis as well as monthly basis and therefore, deposits the cash in the saving account on regular basis. The Ld. AR submitted that Notice under Section 148 of the Act issued by the Assessing Officer was not received by the assessee and therefore, the assessee could not produce the relevant evidences before the Assessing Officer during assessment proceedings. The Ld. AR further submitted that the CIT(A) has totally ignored the fact that the assessee is deriving income in cash through sale of agricultural produce and selling of milk. The Ld. AR submitted that despite giving the details of bank account and the withdrawals details, the said evidences were totally ignored by the CIT(A). Thus, the Ld. AR submitted that the addition made by the Assessing Officer is unjustifiable. 6. The Ld. DR relied upon the Assessment order and the order of the CIT(A). ITA No. 1890/Ahd/2019 Faljibhai Laljibhai Chaudhari vs. ITO Asst.Year–2011-12 - 3 - 7. Heard both the parties and perused all the relevant material available on record. It is pertinent to note that the Assessee has regularly deposited the cash as well as regularly withdrawn certain amount from his saving account. In fact, the CIT(A) is observing that cash deposits are in the earlier of each month as well as at the end of each month, itself shows that the assessee derives income of the agricultural produce on monthly basis. In fact, the bank account details also affirms the same. Besides this the withdrawal from the bank account of the assessee are also demonstrates that the cash was in hand of the assessee from his own bank account. Therefore, the Assessing Officer as well as the CIT(A) has not taken cognizance of the details filed by the Assessee explaining the cash deposit on two dates which was explained by the assessee. Therefore, the addition made by the Assessing Officer does not sustain. The appeal of the assessee is allowed. 8. In result, appeal of the assessee is allowed. This Order pronounced in Open Court on 29/03/2023 Sd/- (SUCHITRA KAMBLE) JUDICIAL MEMBER Ahmedabad; Dated 29/03/2023 TANMAY, Sr. PS TRUE COPY आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आय ु त / Concerned CIT 4. आयकर आय ु त(अपील) / The CIT(A)- 5. वभागीय त न ध, आयकर अपील!य अ धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड' फाईल / Guard file. आदेशान ु सार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील य अ धकरण, अहमदाबाद / ITAT, Ahmedabad