SANJEEV KUMAR PANDEY, MUMBAI V. ACIT, CIRCLE-3, THANE, THANE

ITA 2226/MUM/2022

AI Insights

The case involves Sanjeev Kumar Pandey, who appealed against the order of the National Faceless Appeal Centre (NFAC)/CIT(A), Delhi, which added cash deposits of Rs. 29,52,500 under section 69 of the Income Tax Act, 1961. The Assessing Officer (AO) had initially found that the assessee made substantial cash deposits during the demonetization period and failed to substantiate the sources of these deposits. The CIT(A) upheld the AO's decision, leading to the appeal before the Tribunal. The Tribunal found that the factual aspects needed verification and allowed the assessee another opportunity to substantiate his claims with adequate evidence.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 299414 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 22-02-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 04-09-2022
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Salary income; Set aside
• Section: 69; 143(3); 142(1); 143(1); 250; 143(2); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “G” BENCH, MUMBAI BEFORE SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER & SHIR PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA No. 2226/Mum/2022 (A.Y: 2017-18) Sanjeev Kumar Pandey Flat No. 702, Siddhanchal Elite, Pokhran Road, No. 2 Thane (W) – 400610 Maharashtra. Vs. ACIT, Circle-3 Ashar IT Park, 6 th Floor, Road No. 16Z, Wagle Industrial Estate, Thane (W) – 400604 Maharashtra. PAN/GIR No. : AGUPP3416B Appellant .. Respondent Appellant by : Shri.Dharan Gandhi.AR Respondent by : Shri.Harmesh Lal.DR Date of Hearing 23.02.2023 Date of Pronouncement 27.02.2023 आदेश / O R D E R PER PAVAN KUMAR GADALE JM: The assessee has filed the appeal against the order of the National Faceless Appeal Centre (NFAC)/CIT(A), Delhi passed u/s 143(3) and 250 of the Act. The assessee has raised the following grounds of appeal: 1. The Ld. CIT(A)/NFAC, Delhi has erred in adding cash deposit u/s 69 of the Act without adjudicating on facts and material available on record that the cash deposits ITA No. 2226/Mum/2022 Sanjeev Kumar Pandey, Mumbai. - 2 - were in the bank of Rs. 29,52,500/- is out of the mount withdrawn from the appellant bank account. 2. The brief facts of the case that the assessee is an individual and derives income from salary, income from business and income from other sources. The assessee has filed the return of income on 28.12.2017 for the A.Y 2017-18 disclosing a total income of Rs. 2,37,65,150/- and was processed u/s 143(1) of the Act. Subsequently the case was selected for scrutiny under the CASS and notice u/s 143(2) and 142(1) of the Act along with the a questionnaire are issued to the assessee through ITBA system and the assessee has filed the requisite details.In the course of assessment proceedings, the Assessing Officer(AO) found that the assessee has made cash deposits of Rs.33,22,500/- in the Kotak Mahindra Bank account and Rs.9,30,000/- in Axis Bank account total aggregating to Rs.42,52,500/- during the demonetization period. The A.O has issued notice u/s 142(1) of the Act dated 02.12.2019 on the assessee to explain the sources of cash deposits in the bank accounts during the demonetization period, since the assessee has not responded to the notice, the A.O has ITA No. 2226/Mum/2022 Sanjeev Kumar Pandey, Mumbai. - 3 - issued a show cause notice. In compliance, the assessee has filed explanations on 11.12.2019 mentioning that the assessee’s father was cancer patient and for his hospitalization purpose the assessee has withdrawn the money from bank accounts and were deposited in the bank as the assessee’s father expired in the month of June 2016. 3. Whereas, the AO found the explanations were not substantiated with any evidences and the assessee has withdrawn the amount from the Axis bank up to 8.11.2016 to the extent of Rs.13 lakhs and the remaining amount of withdrawals from other bank are not substantiated with any documents. Whereas the assessee has made elaborate submissions in respect of availability of cash balance and the withdrawals made in the banks accounts. The AO has dealt in respect of deposits and the withdrawals in the Kotak Mahindra bank and Axis Bank and after giving credit of Rs 13 lakhs towards the withdrawals made in the Axis Bank against cash deposits during demonetization period and the remaining amount of Rs.29,52,500/-is deemed as income of the assessee u/s 69 of the Act and assessed the total income of Rs. ITA No. 2226/Mum/2022 Sanjeev Kumar Pandey, Mumbai. - 4 - 2,67,17,650/- and passed the order u/s 143(3) of the Act dated 23.12.2019. 4. Aggrieved by the order, the assessee has filed an appeal before the CIT(A), whereas the CIT(A) considered the grounds of appeal, submissions of the assessee and findings of the AO.The CIT(A) found that the assessee’s has one more bank account with Union Bank where there is a withdrawal of Rs.45,96,000/- on 1.06.2016. Subsequently the assessee has purchased the property from M/s Kalpataru Properties and made payments on 17.06.2016 and 11.07.2016 and therefore the CIT(A) is of the opinion that the additional withdrawal amount is not available to the assessee and is utilized for the purpose of purchase of property and dismissed the assessee appeal. Aggrieved by the CIT(A)order, the assessee has filed an appeal before the Hon’ble Tribunal. 5. At the time of hearing, the ld. AR submitted that the CIT(A) erred in confirming the additions made by AO irrespective of the fact that the assessee has evidences and information to substantiate the ITA No. 2226/Mum/2022 Sanjeev Kumar Pandey, Mumbai. - 5 - withdrawals. The Ld. AR further submitted that the CIT(A) raised the doubt on the self cheque withdrawal from the Union Bank and the Ld.AR has produced the original letter from the bank in respect of the withdrawal made from the Union Bank account and the Ld.AR has substantiated the submissions with the judicial decisions and factual paper book and prayed for allowing the appeal. Contra, the Ld.DR supported the order of the CIT(A). 6. We heard the rival submissions and perused the material on record. The Sole crux of the disputed issue is in respect of cash deposits made by the assessee during the demonetization period. The contentions of the Ld. AR that the assessee has sufficient cash balances and derives income from salary, business and income from other sources. We find the assessee has made withdrawals from Axis Bank account to the extent of Rs. 13 lakhs and which has been accepted by the AO. Further the Ld.AR has substantiated the submissions with the details and referred to page 12 of the paper book,were bank statement of Union Bank of India for the period from 01.04.2016 to 31.03.2017 is placed and demonstrated the cash withdrawal of ITA No. 2226/Mum/2022 Sanjeev Kumar Pandey, Mumbai. - 6 - Rs.45,96,000/- on 01.06.2016 and since the money was not utilized for the medical treatment as the assesses father expired in june2016 and therefore the amounts available were deposited in the bank accounts during the demonetization period. 7. Whereas the Ld.DR submitted that subsequent to the withdrawal of the said amount, there are cheque payments made for the purchase of property and the amount is not available to the assessee, but the Ld. DR could not substantiate that this amount was utilized for the purpose of purchase of property as there are no findings on this issue. Therefore we considering the facts, submissions and the material submitted by the assessee are of the opinion that the factual aspects are to be verified. Further the Ld.AR referred to the statement at page 8 of the paper book where the withdrawals summery was submitted for the F.Y 2014-15, 2015-16 and 2016-17 but this summary is not sufficient and therefore the Ld. AR has to file a cash flow statement and the receipts and payments to show that the balances are available to the assessee to make cash deposits in the bank accounts. Whereas the Ld.AR pleaded one more opportunity of hearing before ITA No. 2226/Mum/2022 Sanjeev Kumar Pandey, Mumbai. - 7 - the lower authorities to file the cash flow statement and receipts and payment for the financial year 2016- 17 and substantiate with vital details and information in support of cash deposits. Therefore considering the facts, circumstances, and the evidence of original letter of union bank confirming the cash withdrawal as discussed above, we are of the opinion that the assessee should not suffer for non filing of material information, as the evidences played vital role in decision making. Accordingly, to meet the ends of justice, we set aside the order of the CIT(A) and restore the entire disputed issues along with the evidences to the file of the Assessing officer to decide afresh on merits and the assessee should be provided adequate opportunity of hearing and allow the grounds of appeal of the assessee for statistical purposes. 8. In the result, appeal filed by the assessee is allowed for statistical purposes Order pronounced in the open court on 27. 02.2023. Sd/- Sd/- (OM PRAKASH KANT) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai, Dated 27.02.2023 ITA No. 2226/Mum/2022 Sanjeev Kumar Pandey, Mumbai. - 8 - KRK, PS /Copy of the Order forwarded to : 1. / The Appellant 2. / The Respondent. 3. आ आ / The CIT(A) 4. आ आ ( ) / Concerned CIT 5. ! !" , आ $ %, हमद द / DR, ITAT, Mumbai 6. () * + / Guard file. ान ु सार/ BY ORDER, ! //True Copy//() ( Asst. Registrar) ITAT, Mumbai