Kishan Kothwal V. Income Tax Officer

ITTA/99/2021

AI Insights

The case involves Kishan Kothwal, the appellant, who contested the addition of Rs.10,00,000 to his income for the assessment year 2017-18, which was deemed unexplained by the Income Tax Officer, Siddipet. The addition was based on cash deposits found in the appellant's bank account during the demonetization period. The Assessing Officer and the Commissioner of Income Tax (Appeals) both rejected the appellant's explanation that the deposits were from his salary savings and his son's savings. The Tribunal upheld these decisions, leading to the High Court's dismissal of the appeal.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 753460 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 03-12-2021
• Assessment Year: misc
• Other Referred Cases: COMMISSIONER of INCOME TAX, HYDERABAD v. TILAK RAJ KUMAR, HAWX INS v. POWELLS TILLERY STEAM COMPANY LIMITED
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Assessee Lawyers: VIJAY KUMAR PUNNA
• Keywords: Cash deposits; Demonetization; Income tax appeal; Unexplained deposits
• Section: 131; 151; 69 A; 260-A

Judgement Text

"IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD FRIDAY, THE THIRD DAY OF DECEI ,IBER TWO THOUSAND AND TWENTY ONE PRESENT THE HONOURABLE SRI JUSTICE UJJAL BHUYAN AND THE HONOURABLE SMT JUSTICE P.MADHAVI DEVI INCOME TAX TRIBUNAL APPEAL NO: 99 OF 2021 lncome Tax Tribunal Appeal under Section 260-A of the lncome Tax Act, 1961, against the order of the lncome Tax Appellate Tribunal, Hyderabad Bench 'B' Hyderabad in ITA No.2B9lHl2020 for assessment year 2017-18 daled 2810612021 preferred against the Order of the Commissioner of lncome Tax (Appeals)-7 Hyderabad, Appeal No. 0 1 69/ClT(A)-7l20 1 9-20 dated 27 101 I 2020 preferred against the Order of the lncome Tax Officer, Ward-1,Siddipet, PAN/EKSPK6368F dated 2411012019 Between: Kishan Kothwal, 10-4-466, Nasarpura, Siddipet, Medak, Telangana- 502103. AND ...APPELLANT lncome Tax Officer, Ward- 1 , Siddipet, Medak. .,.RESPONDENT lA NO: 1 OF 2021 Petition under Section 151 of CPC praying that in the circumstances stated in the affidavit filed therewith, the High court may be pleased to stay the operation of the order in lrA No. 2$9l l2o2o (Assessment Year 2017-18) (on the file of lncome- Tax Appellate Tribunal, Hyderabad Bench'B' Hyderabad) For the Appellant : SRI VIJAY KUMAR PUNNA, Advocate For the Respondent : NONE APPEARED The Court made the following: ORDER HONOL RABLE SRI JUSTICE UJJAL BHUYI .N AND HONOUR.BLE SMT. JUSTICE P. MADIIAVI T)EVI I.T.T.A.No.99 OF 2021 QEDE& fpn, fro n't te Sri Justice t}jjal Bhuyanl Heard Mr. y'ijay Kumar Punna, learned counsel for the appellant 2. This appeal ras been prefened by the assessee, as the appellant, under Section 26C { of the Income Tax Act, 1961 (briefly 'the Act' hereinafter) agains the order dated 28.06.2021 passed by tlte Income Tax Appellate Tril unal, Hyderabad Bench 'B', Hyderabad (Tribunal) in LT.A.No.28 glH.2020 for the assessment year 2017 -18. 3. The issue in 'olved in the present appeal is confirmation of the addition made by t re Assessing Officer to the income oltht: assessee under Section 69-A ofthe Act 4. In the proc:edings for the assessment year 2017-18, the Assessing Officer bund cash deposits in the bank account of the assessee aggregatin 3 to Rs.13,16,304.00. Assessee submitted that he has deposited only {s.10 lakhs during the demonetization period and not Rs.13,16,304.0 ). Verifrcation of the bank account statement showed the deposit of cash of Rs.10 lakhs on 12.11.20 l6 in addition to certain other deoosits in tranches. Regarding cash deposit of Rs.10 lakhs, acco'ding to the assessee, the same was out of 1/3'd salary savings from his salary since 2006 and also 1/3\"r savings 2 of his son since 2011. This explanation was not accepted by the Assessing Officer on the ground that it was difficult to believe that such savings were kept at home over so many years' In addition' a furthersumofRs.2.T5lakhswasalsofoundtobeunexplained. Therefore, the Assessing Officer added a sum of Rs'12,75'000'00 to the retumed income of the assessee as unexplained deposits in bank account, considering the same as income under Section 69A of the Act. 5. In appeal before the Commissioner of Income Tax (Appeals)-7' Hyderabad (for short, 'CIT (A)' hereinafter), the Appellate Authority recorded the statement of the assessee under Section 13 I of the Act in the presence of his authorized representative. It was noted that assesssee is a State Government employee and he was required to inform the State Government in the event of making any investment in speculative transaction. While granting relief to the extent of Rs.2.75 lakhs, which was stated to be on account of withdrawal from his GPF, the first Appellate Authority confirmed the addition of Rs.l0 lakhs made by the Assessing Officer' 6 In further appeal before the Tribunal, Tribunal held as follows: \"We have considered the rival submissions and perused the material on record as well as gone through the orders of revenue authorities. The CIT(A) demonstrated in his order that the assessee does not have sufficient money to pay monthly chit installments by way of recording hls statement u/s 131 of the Act and examining the bank statements, further observed that no documentary 3 evide rce was filed by the assessee to est,ablish genur reness of the chit fund claim. Further, the CIT (h) obser /ed that being govt. employee, the assessee is not permi ted to enter in chit fund. Even before us, the ld AtL of th( assessee failed to establish that the amount cf Rs.10 00,0001 received from chit fund and thr-' submi ;sions in the written submissions are general and vogue which are not supported to the case of the asses ee. The CIT (A) examined the bank statement of the as iessee and after observing the monthly expenditur€) of the lssessee and nature of transactions carried out b), the as;essee, he has rightly sustained the addition nrad€, by the AO. Therefore, we do not find any infirmity in the order cf the CIT (A) in confirming the addition ol Rs.10, 10,000/- made by the AO u/s 69A of the Act and therefc'e, upholding the order of the CIT(A), we dis,niss the grc rnd raised by the assessee on this issue\". 7 . On due conr ideration, we do not find any error or in firnrity in the view taken by t re Tribunal. Besides, there is concurrent tinding of fact. No question cf law arises from the said order of the Trirunal, not to speak ol any iubstantial question of law. 8. Learned cou rsel for the appellant relied upon the bllorving decisions: (i) COMN IISSIONER of INCOME TAx, HYDE{ABADv. TILAK RAJ KUMAR (2015) 56 \"axmann;com 36 (Andhra Pradesh and Telang rna). (ii) HAWX INS v. POWELLS TILLERY STEAM coAL IOMPANY LIMITED (988 KING',S BENC] TDMSION 1911). 4 g.InsofarthedecisionofthiscourtinTilakRajKumar(supra)is concerned, we find that it was a case of sale transaction of diamonds under Section 68 of the Act. The parameters for making addition under Section 68 ofthe Act and under Section 69A ofthe Act, though may appear to be similar, however, is not so; therefore, addition of cash credit under Section 68 0f the Act would stand on a different pedestai. The principles governing cash credit under Section 68 of the Act cannot be extended to unexplained investments under Section 69A of the Act. 10. Insofar the English decision is concerned, the facts are totally different, the same arising out of benefits received under the Workmen's Compensation Act. The said decision is not at all applicable to the facts atld circutlstances of the present case' I I . Consequently, tl.re appeal is dismissed' 12. Miscellaneous applications, il any pending, shall stand closed' 1 3. No cttsts. //TRUE COPY// Sd/.B.S.CHIRANJEEVI JOINT REGISTRAR Q't SECTION OFFICER To 1. The lncome Tax Appellate Tribunal, Hyderabad 'B' Bench, Hyderabad 2. The Commissioner of lncome Tax (Appeals)-7, 3'o Floor, l.T.Towers, A.C.Guards, Hyderabad, Telangana-500 004 The lncome Tax Officer, Ward-'l , Siddipet, lr/edak District. One CC to Sri Vijay Kumar Punna, Advocate (OPUC) Two CD Copies One Spare Copy 4. E 6. Kj X!{k I HIGH COURT DATED:O311212021 JUDGMENT ITTA.No.99 of 2021 1i e ST . { '-. ts lluztu ; DISMISSING THE ITTA WI THOUT COSTS. "