KAILASH CHAND SHARMA NEAR CHARBHUJA MANDIR, V. COMMISSIONER OF INCOME TAX 1

ITA/111/2023

AI Insights

The case involves Kailash Chand Sharma, the appellant, who appealed against the order of the Income Tax Appellate Tribunal, Jaipur, which confirmed the addition of Rs. 10,15,921 as unexplained cash credit under Section 68 of the Income Tax Act. The appellant had declared an income from pension but was found to have a substantial cash deposit in his bank account, which he claimed belonged to Kana Ram, a person who had sold property and temporarily deposited the money in the appellant's account. The Tribunal and the High Court found the appellant's explanations insufficient and inconsistent, leading to the dismissal of the appeal.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 672519 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 05-07-2024
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income Tax Vs. Divine Leasing and Finance Ltd. [(2008)299 ITR 268 (Delhi)]
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: ANURAG MATHUR
• Assessee Lawyers: DOLLY SHARMA
• Keywords: Assessment Year; Burden of Proof; Cash credit; Cash deposit; Income from pension; Income Tax
• Section: 143(3); 68; 260A

Judgement Text

"[2024:RJ-JP:28142-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No.111/2023 Kailash Chand Sharma Near Charbhuja Mandir, Aged About 64 Years, Old Kekri, Kekri, Ajmer - 305404 ----Appellant Versus Commissioner Of Income Tax 1, New Central Revenue Building Statue Circle Jaipur (Raj.) ----Respondent For Appellant(s) : Ms.Dolly Sharma, Adv. for Mr.Prateek Kasliwal, Adv. For Respondent(s) : Mr.Anurag Mathur, Adv. for Mr.Shantanu Sharma, Adv. HON'BLE MR. JUSTICE AVNEESH JHINGAN HON'BLE MR. JUSTICE ASHUTOSH KUMAR Order 05/07/2024 AVNEESH JHINGAN, J (ORAL):- 1. This appeal is filed under Section 260A of the Income Tax Act, 1961 (hereafter ‘the Act’) against the order dated 22.06.2021 passed by the Income Tax Appellate Tribunal, Jaipur Bench, Jaipur (hereafter ‘the Tribunal’). 2. The brief facts are that the appellant is income tax assessee and filed the income tax return for Assessment Year of 2014-15, declaring income from pension of Rs.6,05,250/-. The Department got information of cash deposit of Rs.47,30,000/- in the bank account of the appellant. Notice under Section 143(3) of the Act was issued. The appellant replied that cash deposited belonged to Kana Ram, who had sold an immovable property and was not having a bank account. Further that the amount was to be [2024:RJ-JP:28142-DB] (2 of 4) [ITA-111/2023] returned to Kana Ram on his opening the bank account. Kana Ram was summoned, he filed reply through his counsel taking a contrary stand. Addition of Rs. 34,50,000/- was made in the assessment finalized vide order dated 26.12.2018. The first appeal was dismissed on 22.02.2019. The appellant failed before the tribunal hence, the present appeal. 3. The following substantial questions of law have been proposed in the appeal:- i) Whether the Order of the Ld. ITAT has erred in law and in the facts and circumstances of the case in confirming the addition of Rs.10,15,921/- as cash credit levied by the A.O. u/s 68 of the Income Tax Act. ii) Whether facts put forth by the Appellant- Assessee in an Affidavit could be disregarded without any material to dislodge the position taken by the Appellant-Assessee? iii) Whether in the facts and circumstances of the case the ITAT was justified in law being not acting as the last fact finding authority? iv) Whether in the facts & circumstances of the case the ITAT has acted perversely? 4. Learned counsel for the appellant submits that the appellant discharged the onus by explaining the cash deposited was of Kana Ram and it was for assessing officer to bring out the truth. Contention is that the account statements were attached to show that the cash deposited was transferred at the instance of Kana Ram. Reliance is placed upon the decision of the Delhi High Court in the case of Commissioner of Income Tax Vs. Divine Leasing and Finance Ltd. reported in [(2008)299 ITR 268 (Delhi)]. [2024:RJ-JP:28142-DB] (3 of 4) [ITA-111/2023] 5. Learned counsel for the Department defends the impugned order and submits that the appellant failed to explain the cash deposit made in the bank account. 6. The appellant failed to discharge the onus of explaining the cash deposit. The explanation put forth fell flat, on denial by Mr. Kana Ram that cash belonged to him. No income tax returns of Kana Ram, were produced to establish that the sale of immovable property was declared in the returns. The credit worthiness of kana Ram was not proved. 7. The explanation that the amount of Kana Ram was deposited in the bank account of the appellant, was falsified by denial of Kana Ram. The stand set up that the amount was to be transferred to Kana Ram on his opening the bank account was later changed. It was stated that the cash amount were transferred to various persons at the instance of Kana Ram. It would be pertinent to note that even this stand was not substantiated. The bank statements produced had debit entries but no where indicated that transfers were made at the instance of Kana Ram. 8. Reliance on the decision of the Delhi High Court in the case of Commissioner of Income Tax Vs. Divine Leasing and Finance Ltd. (supra) is of no avail. The Delhi High Court was dealing with the issue where the subscription received by a public limited company from a public issue was doubted. On failure of Assessing Officer to bring on record the material evidence to indicate that shareholders were benamidars or fictitious persons or part of capital represented the income of the company was from undisclosed sources, the deletion of addition was upheld. In the [2024:RJ-JP:28142-DB] (4 of 4) [ITA-111/2023] case in hand the cash was deposited in bank account of appellant and there was failure to explain the source of cash. 9. No case is made out for interference in concurrent findings recorded by both the appellate authorities. No question of law much less substantial question of law arises for consideration. 10. The appeal is dismissed. (ASHUTOSH KUMAR), J (AVNEESH JHINGAN), J HS/MADAN/39 Reportable:- Yes "