Parvati Gupta, Delhi V. ITO, Ward 2(2)(1), Ghaziabad

ITA 1911/DEL/2023

AI Insights

The case involves Parvati Gupta, the appellant, who contested the order of the CIT(A), National Faceless Appeal Centre, Delhi, which confirmed the addition of INR 14,38,600 to her income for the assessment year 2012-13. The addition was initially made by the Assessing Officer under sections 144/147 of the Income Tax Act, 1961, due to unexplained cash deposits in the assessee's bank account. The Tribunal found that while the total cash deposit could not be entirely treated as income, a portion representing 10% of the total deposit was undisclosed income from cash sales.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 122253 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-08-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: SMC
• Next Hearing Date: 16-08-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 26-06-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Reasonable cause; Corroborative evidences
• Section: 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “SMC” BENCH: NEW DELHI BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER ITA No.1911/Del/2023 [Assessment Year : 2012-13] Parvati Gupta, F-207, Alaknanda Apartment, Rampuri, Chander Nagar, Ghaziabad, Uttar Pradesh-201011. PAN-AOAPG2423B vs ITO, Ward-2(2)(1), Ghaziabad. APPELLANT RESPONDENT Appellant by Shri K.Sampath & Shri V. Raja Kumar, Advocates Respondent by Shri Om Parkash, Sr.DR Date of Hearing 17.08.2023 Date of Pronouncement 30.08.2023 ORDER PER KUL BHARAT, JM : The present appeal filed by the assessee is directed against the order passed by Ld.CIT(A), National Faceless Appeal Centre (“NFAC”), Delhi dated 29.03.2023 for the assessment year 2012-13. The assessee has raised following grounds of appeal:- 1. “On the facts and in the circumstances of the case and in law the NFAC, Delhi erred in confirming the action of the Assessing Officer:- i. concluding assessment u/s 144/147 of the Act without providing any opportunity of hearing. ii. initiating proceedings u/s 147/148 of the Act without there being any valid reason leading to the belief of escapement of income. iii. confirming the order passed u/s 144 r.w.s 147 of the Act determining taxable income at Rs.14,38,600/- being the Page | 2 amount of cash deposit in the bank treating the same as unexplained. The above action s being arbitrary, fallacious, unwarranted and illegal must be quashed with directions for appropriate relief.” 2. The present appeal filed by the assessee is time barred by 30 days. The assessee has filed an application dated 08.08.2023 seeking condonation of delay of 30 days. An affidavit dated 04.08.2023 filed by the assessee in support of her contention. Ld. Counsel for the assessee reiterated the submissions as made in the affidavit filed by the assessee. He submitted that there was reasonable cause for not filing the appeal in time. 3. Ld. Sr. DR opposed these submissions and submitted that there is no reasonable cause for filing the present appeal late by 30 days. 4. Heard the rival contentions and perused the material available on record. It is stated in the affidavit filed by the assessee that son of the assessee was suffering from serious illness during that time therefore, the appeal could not be filed in time. For the reasons stated in the affidavit, I am of the view that there was a reasonable cause for not filing the present appeal in time. Therefore, considering the reasons stated in the application, the delay is condoned and the appeal is taken up for hearing. 5. The only effective ground raised by the assessee is against the sustaining of addition amounting to INR 14,38,600/-. 6. Facts giving rise to the present appeal are that the Assessing Officer (“AO”) received information regarding cash deposited by the assessee in her Page | 3 Saving bank account. Since the assessee had not filed income tax return therefore, the case of the assessee was re-opened for assessment. Secondly, a notice u/s 148 of the Income Tax Act, 1961 (“the Act”) was issued to the assessee. There was no representation on behalf of the assessee. Therefore, the AO framed the assessment u/s 144/147 of the Act order dated 14.10.2019 and made addition of entire cash of INR 14,38,600/- deposited in the bank account of the assessee. 7. Aggrieved against this, the assessee preferred appeal before Ld.CIT(A), who after considering the submissions, sustained the addition for want of supporting evidence and dismissed the appeal of the assessee. 8. Aggrieved against this, the assessee preferred appeal before this Tribunal. 9. Ld. Counsel for the assessee, Shri K Sampath, Advocate vehemently argued that the assessee was not given adequate opportunity to represent her case. The assessee is engaged in a small business of trading in ladies suits. Ld. Counsel for the assessee has also drew my attention to the Paper Book where he has enclosed bank statement and other evidences as computation of income, balance sheet etc. He contended that the deposit in the bank account was out of cash sales. Therefore, the authorities below grossly erred in making the addition and sustaining the same. He prayed that the impugned addition may be deleted. Page | 4 10. On the other hand, Ld. Sr. DR opposed these submissions and supported the orders of the authorities below. He contended that the assessee failed to furnish the requisite details before the lower authorities. 11. I have heard Ld. Authorized Representatives of the parties and perused the material available on record. I find from the bank statement that there were deposits as well as withdrawals from bank accounts that showed that the cash was being deposited and withdrawn. It is the case of the assessee that the amount was out of cash sales and the withdrawal was made for purchasing of material. 12. Looking to the facts of the present case that total cash deposit was INR 14,38,600/-. The AO has not taken into the account the withdrawal made by the assessee. Hence, considering the totality of the facts, the entire cash deposit cannot be treated as income of the assessee. Taking into account the nature of business of the assessee, 10% of the total cash deposit i.e. INR 1,43,860/- to be treated as undisclosed income of the assessee. Hence, out of the total addition of INR 14,38,600/-, a sum of INR 1,43,860/- is hereby, sustained. Thus, grounds raised by the assessee are partly allowed. 13. In the result, the appeal of the assessee is partly allowed. Order pronounced in the open Court on 30 th August, 2023. Sd/- (KUL BHARAT) JUDICIAL MEMBER * Amit Kumar * Page | 5 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI