ITO 3(2), MATHURA V. HARSH SALUJA, MATHURA

MA 27/AGR/2018

AI Insights

The case revolves around a Miscellaneous Application filed by the Revenue seeking to recall an earlier Tribunal order that deleted an addition made to the assessee's income for unexplained cash deposits. The assessee, Harsh Saluja, had deposited Rs. 12,97,291 in his bank account, which was not disclosed in his books. The Assessing Officer (AO) added Rs. 3,30,471 to the assessee's income, treating it as business turnover. The CIT(Appeal) enhanced this addition, treating it as unexplained cash credit under section 68 of the Income Tax Act. However, the Tribunal deleted the addition, stating that the bank passbook is not a book of account and thus, additions under section 68 were not justified. The Department's attempt to sustain the addition under section 69A was also rejected by the Tribunal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 653154 (ITAT-AGRA)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-06-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Other Referred Cases: Bhaichand N. Gandhi, Taj Borewells, Narendra Kishore Goswami, Smt. Sareka Jain vs. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAILENDER SHRIVASTAVA; THIS
• Assessee Lawyers: NAVEEN GARG
• Keywords: Unexplained cash credit
• Section: 68; 69

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH ‘DB’ AGRA (Through Physical/Virtual Hearing) BEFORE SHRI SUNIL KUMAR SINGH, JUDICIAL MEMBER AND SHRI BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER MA No.27/Agr/2018 (Arising out of ITA No.165/Agr/2016) [Assessment Year: 2011-12] Income Tax Officer, Ward-1(3)(2), Mathura, Uttar Pradesh Vs Harsh Saluja, 86C, Krishna Nagar, Mathura, Uttar Pradesh PAN-AYRPS3957K Appellant Respondent Appellant by Shri Sailender Shrivastava, Sr. DR Respondent by Shri Naveen Garg, Adv. Date of Hearing 04.04.2025 Date of Pronouncement 20.06.2025 ORDER PER BRAJESH KUMAR SINGH, AM, This Miscellaneous Application filed by the Revenue is seeking recalling of order dated 01.12.2017 passed by the Tribunal in ITA No.165/Agr/2016 relating to Assessment Year 2011-12. The content of Miscellaneous Application filed by the Revenue is reproduced hereunder:- “Subject: Miscellaneous Application for vecalling of order under Rule 24 of ITAT Rules, 1963 read with section 254 of the Income Tax Act, 1961 :- With regard to the above, it is submitted that the assessee had deposited cash of Rs 12,97,291/- in his Saving Bank account maintained at Union Bank of India. This account was not disclosed by the assessee in his books of accounts. On perusal of bank account it is noticed that the cash was deposited from different stations throughout the financial year 2010-11 and regular withdrawals were also made. The AO made an addition of Rs 3,30,471/- by applying NP rate 2 MA No.27/Agr/2018 @23.36% on the total cash deposit Rs. 12,97,291/-by treating the same as assessee's business turnover. The CIT(Appeal) enhanced the addition by treating the cast, deposit as unexplained cash credit U/s 68. Ld. ITAT Agra Bench Agra has deleted the addition by observing that the bank account is not the books of accounts of the assessee. It is submitted that the cash deposited in bank account represents the income of the assessee which has not been offered by the assessee for taxation. Therefore, the amount of cash deposit is to be added to the income of the assessee.” 2. In this case, the assessee made a cash deposit of Rs.12,97,291/- in his saving bank account. The AO made an addition of Rs.3,30,471/- by applying net profit rate @23.36% of the total cash deposits. In appeal, the ld. CIT(A) enhanced the addition by treating the cash deposits as unexplained cash credit u/s 68 of the Act. The Tribunal deleted the said addition by observing that the bank pass book was not a books of accounts of the assessee and therefore the addition u/s 68 of the Act was not justified. The Tribunal also rejected the plea of the Department for sustaining the addition u/s 69A of the Act, if it was not maintainable u/s 68 of the Act. The relevant discussion of the Tribunal in para no. 6 & 7 are reproduced as under:- “6. I have heard the parties and have perused the material on record. In ‘Bhaichand N. Gandhi’ (supra), ‘Taj Borewells’ (supra) and ‘Narendra Kishore Goswami’(supra), it has categorically been held that in case of bank deposits, bank passbook not being a book of account, no addition can be made by following the provisions of section 68 of the Act. No decision contrary to the above decisions has been cited. 7. Apropos the Department’s contention that in case the addition u/s 68 of the Act was not to be sustained, the same be sustained by invoking the provisions of section 69 of the Act. I do not find substance in this contention. Nothing has been brought before me to show that this course of action can be adopted by the Tribunal. Rather, in ‘Smt. Sareka Jain vs. CIT’, 84 Taxmann. Com 64(Allahabad), it has been held that where the subject matter of the dispute in the appeal before the Tribunal is the addition made under section 68 of the I.T. Act, 3 MA No.27/Agr/2018 the Tribunal cannot travel beyond the scope of the appeal to convert the addition to one under section 69A of the Act.” 3. We have heard both the parties. The Department by this Miscellaneous Application has not pointed out any mistake apparent from the record and was seeking the recall the earlier order of the Tribunal decided on merits. This will amount to review of the order dated 01.12.2017 in the case of the assessee, which is not permissible. Therefore, the Miscellaneous Application of the Department is dismissed. 4. In the result, the Miscellaneous Application filed by the Department is dismissed. Order pronounced in the open court on 20th June, 2025. Sd/- Sd/- [SUNIL KUMAR SINGH] [BRAJESH KUMAR SINGH] JUDICIAL MEMBER ACCOUNTANT MEMBER Dated 20.06.2025. f{x~{tÜ f{x~{tÜ f{x~{tÜ f{x~{tÜ Copy forwarded to: 1. Appellant 2. Respondent 3. PCIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, Agra "