Shri Dhirajlal Ratilal Maniyar, Surendranagar V. The ITO, Ward-5, Surendranagar

ITA 19/RJT/2020

AI Insights

The case involves Dhirajlal Ratilal Maniyar, who appealed against the order of the Commissioner of Income Tax (Appeals)-7, Ahmedabad, which pertained to the assessment year 2011-12. The primary issue was the addition of Rs.19,53,079 to the assessee's income, categorized as unexplained deposits in his bank account. The Assessing Officer had noted substantial cash and non-cash deposits in the assessee's account and, upon the assessee's failure to explain these deposits despite multiple opportunities, treated them as unexplained income under section 69A of the Income Tax Act. The CIT(A) upheld this decision, leading to the current appeal before the Tribunal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 133714 (ITAT-RAJKOT)
• Duration Of Justice: 2 year(s) 11 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 09-01-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 27-01-2020
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Corroborative evidences; Onus to prove
• Section: 144; 69A

Judgement Text

आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरणआयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण, राजकोट 瀈यायपीठ 瀈यायपीठ瀈यायपीठ 瀈यायपीठ, , , , राजकोट IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT (Conducted Through Virtual Court) ] ] BEFORE SMT.ANNAPURNA GUPTA, ACCOUNTANT MEMBER AND SHRI T.R. SENTHIL KUMAR, JUDICIAL MEMBER ITA No.19/RJT/2020 Asstt.Year :2011-12 Dhirajlal Ratilal Maniyar Dipak P. Shah & Co Cotton Hall, 1 st Floor Main Road Surendranagar. PAN : AYCPM 1875 F Vs ITO, Ward-5 Surendranagar. (Applicant) (Responent) Assesseeby : None Revenue by : Shri K.L. Soanki, ld.DR स ु नवाई क तार ख/D a t e o f H e a r i n g : 1 0 / 0 1 / 2 0 2 3 घोषणा क तार ख /D a t e o f P r o n o u n c e m e n t : 1 8 / 0 1 / 2 0 2 3 आदेश/O R D E R PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER The present appeal has been filed by the assessee against order passed by the Commissioner of Income Tax(A)-7, Ahmedabad (in short referred to as ld.CIT(A) under section 250(6)of the Income Tax Act, 1961 ("the Act" for short), dated 29.11.2019 pertaining to the Asst.Year 2011-12. 2. At the time of hearing, neither assessee nor any of his representatives remained present. It is further noticed that the appeal of the assessee was instituted on 28.1.2020. Thereafter, the ITA No.19/Rjt/2020 2 case of the assessee was listed on five occasions, but all the hearings remained unattended. Further except on one occasion, i.e 08-09- 2022, no application seeking adjournment was also filed. The Registry has also noted that no power of attorney in favour of any counsel has been filed with the appeal. In this view of the matter, it demonstrates that the assessee is not interested in pursuing its appeal, and accordingly, we proceed to adjudicate the appeal ex parte. 3. The grounds of the appeal raised by the assessee are as under: 1. The Hon’ble CIT(A) has erred in law as well as facts in not deleting the addition as unexplained cash deposit u/s.69A. 2. The impugned assessment order requires to be quashed as bad in law and void ab initio. 3. The Honorable CIT(A) has erred in law and on facts in sustaining the learned Assessing Officer's Order under section 144 r.w.s.147. 4. The Honorable CIT(A) has erred in law as well as facts in confirming the Addition made by Ld. Assessing officer on account of Cash Deposits and other than cash deposits. 5. The Honorable CIT(A) has erred in law as well as facts in not deleting the addition of Cash Deposits Of Rs. 16,84,000/-. 6. The Honorable CIT(A) has erred in law as well as facts in not deleting the addition of other than Cash Deposits Of Rs.2,69,079/-. 7. The Honorable CIT(A) has erred in law and in fact in not considering the documents and arguments put forward by Assessee during the course of hearing at assessment level and CIT(A) level. 8. The Assessee craves to add, alter and change any of the above grounds of Appeal. 4. The solitary issue raised by the assessee in the appeal is that the ld.CIT(A) has erred in not deleting the addition of Rs.19,53,079/- on account of deposits of Rs.16,84,000/- and Rs.2,69,079/- with State Bank of India, Vagadia Branch and treating the same as unexplained deposits under section 69A of the Act. ITA No.19/Rjt/2020 3 5. Briefly, fact of the matter is that the during assessment proceedings, the AO noticed that the assessee had deposited cash aggregating to Rs.16,84,000/-, and Rs.2,69,079/- was found credited other than cash in the bank account maintained with the State Bank of India. The assessee was asked to explain source of the deposits, however, despite number of opportunities being given to the assessee to explain source and nature of deposits, the assessee failed to do so. Till the date of the assessment order, neither the assessee nor his authorized represented participated in the proceedings nor filed any submission or reply. Therefore, in the absence of any explanation or justification from the assessee, the ld.AO proceeded to make the impugned additions as under: “3.2 The above said show cause notice has been duly served upon the assessee. As per the above said show cause notice, the assessee was required to submit his reply on or before 04.12.2018. However, till date, neither assessee nor his authorized representative submitted any written reply. It is specifically mentioned in the above said show cause notice that if the assessee failed comply with the show cause notice, the assessment shall be finalized on merits. Looking to the non-compliance from the assessee's side, it will be presumed that the assessee has nothing to offer any explanation. As the assessment proceedings is getting barred by limitation and the assessee did not comply of any of notices issued to him, the undersigned left with no other alternate but to finalize the assessment exparte within the meaning of provisions of section 144 of the IT.Act on the basis of material available on record. 3.3 It is a fact that the assessee has deposited an amounting to Rs. 16,84,000/- by cash and Rs. 2,69,079/- was credited other than cash in his bank account maintained with State Bank of India, Vagadia Branch. This fact was never denied by the assessee. It is also fact that the assessee has failed to justify the source of above amount deposited with documentary evidence. The preliminary onus to prove the source of cash deposited is on the assessee. However, the assessee failed to discharge the preliminary burden of proof. It is settled law that the onus is lying on the assessee to explain the nature and sources of deposits. It is the primary duty of the assessee to explain the source of deposited by him with supporting documentary evidence. However, in the present case, the assessee failed to discharge the onus that cast upon him. There is no evidence at all in this case. Accordingly to the provisions of section 69A of the Act, if " the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained ITA No.19/Rjt/2020 4 by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the [Assessing] Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year" . Here in the instant case, the assessee has deposited cash and amount credited of Rs. 19,53,079/- [16,84,000 + 2,69,079] in his bank account and he failed to explain the source of the same with supporting evidence. As such, the alleged amount of Rs.19,53,079/- is to treated as deemed income and taxed within the meaning of provisions of section 69A of the I.T.Act. 6. Thereafter, assessee preferred appeal before the ld.CIT(A) challenging order of the AO. Before the CIT(A) also, the conduct of the assessee was the same; neither assessee nor his authorized representative participated in the appellate proceedings and filed any explanation or details about the source of impugned cash deposits in the Bank. Looking to the non-compliant attitude of the assessee, both during the assessment and appellate proceedings, and non- compliance of various statutory notices, the ld.CIT(A) confirmed the finding of the AO in treating the impugned deposits as deemed income and taxed within the meaning of provisions of section 69A of the Act. While doing so, he has also relied on various case laws. The relevant finding of the ld.CIT(A) at para 5.1 & 5.2 in this behalf is as under: “5.1 The appellant had failed to discharge the onus casted upon him for explaining the source of amounts credited in his bank account which, includes Rs. 16,84,000/- in cash and Rs. 2,69,079/- other than in cash. The AO had given several opportunities to the Appellant. Considering the facts, the impugned amount of Rs.19,53,079/- was treated as unexplained money within the meaning of provisions of section 69A of the Act and treated as income earned from undisclosed sources by the AO. Even the same fact has been well accepted by the Appellant in the statement of facts verified by him in Form No.35 filed by him while preferring the appeal before the undersigned. 5.2 The Appellant has not submitted any details in support of grounds appeal. The Appellant had deposited an amount of Rs. 16,84,000/- cash and Rs. 2,69,079/- other than cash in his bank account maintained with State Bank Of India, VagadiaBranch. Despite several opportunities, the Appellant failed to justify the source of these deposits before AO. Here it is ITA No.19/Rjt/2020 5 to be noted that the Appellant even failed to explain the source before the undersigned during the proceedings of appeal though he was provided with several opportunities of being heard by this office. The Appellant submitted a letter on 26/09/2019 however, the same pertained to some other individual named Pravin Kumar and had nothing to do with the instant appellate proceedings. . . 5.3 Based on the theory of preponderance of probability in civil mattes, deposition of cash itself puts strict onus on the appellant to explain the source of such sums found credited in his bank account. 5.4. On careful consideration of the entire facts, it is found that the appellant has failed to justify the source of such deposits and the Appellant has failed to adduce any proof in this regard. He has failed to discharging the onus casted upon him in terms of section 69A. Therefore, this ground of appeal is dismissed.” 7. Aggrieved, the assessee is now in appeal before the Tribunal. 8. We have heard ld.DR and gone through the orders of the Revenue authorities. We find that the assessee was given a number of opportunities to defend his case before authorities below to justify the impugned deposits made in the Bank. Various statutory notices issued by Revenue authorities to the assessee remained non- complied, not to talk of participation in the proceedings. Both the authorities have recorded a finding to this effect, which have been reproduced by us hereinabove. Even before the Tribunal, after filing appeal, assessee has not come forward to attend in response to any of the notices nor filed any submissions. Therefore, it is clear that the assessee except coming forward to file appeals before the appropriate authorities, is not interested in following up with its matter. In the absence of any representation from the assessee, and in the absence of any material on record to support the case of the assessee, the concurrent findings of the authorities below remain uncontroverted before us. Therefore, the order of the ld.CIT(A) upholding the addition of Rs.19,53,079/- calls for no interference. ITA No.19/Rjt/2020 6 Thus, grounds of appeal raised by the assessee are accordingly rejected. 9. In the result, the appeal of the assessee is dismissed. Order pronounced in the Court on 18 th January, 2023 at Ahmedabad. Sd/- Sd/- (T.R. SENTHIL KUMAR) JUDICIAL MEMBER (ANNAPURNA GUPTA) ACCOUNTANT MEMBER Ahmedabad, dated 18/01/2023