KUKDI DEVI,CHENNAI V. INCOME TAX OFFICER, CHENNAI

ITA 2926/CHNY/2024

AI Insights

The case involves Kukdi Devi, the appellant, contesting the additions made by the Income Tax Officer, Non Corporate Ward 5(1), Chennai, regarding unexplained cash deposits and differential property value for stamp duty for the assessment year 2017-18. The Tribunal examined the reasons for the delay in filing the appeal, which was found to be bona fide, and thus the delay was condoned. The main issues revolved around the assessee's claims of cash in hand and the valuation of a property for which higher stamp duty was paid. The Tribunal referenced a similar case, Smt. Raniammal Subramaniam, to justify a lenient view on the cash deposits.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 315973 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-05-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2017-2018
• Other Referred Cases: Smt. Raniammal Subramaniam vs. Unknown
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DEEPTHA
• Assessee Lawyers: AKSHIT JAIN
• Keywords: Condonation of delay; Unexplained investment; Sale consideration of property below Jantri Value; Value adopted by valuation officer
• Section: 56(2)(vii)(b); 69

Judgement Text

"आयकर अपीलीय अिधकरण, ’ए’ Ɋायपीठ, चेɄई IN THE INCOME-TAX APPELLATE TRIBUNAL ‘A’ BENCH, CHENNAI ŵी एस.एस. िवʷनेũ रिव, Ɋाियक सद˟ एवं ŵी एस.आर. रगुनाथॎ, लेखा सद˟ क े समƗ Before Shri S.S. Viswanethra Ravi, Judicial Member & Shri S.R. Raghunatha, Accountant Member आयकर अपील सं./I.T.A. No.2926/Chny/2024 िनधाŊरण वषŊ/Assessment Year: 2017-18 Kukdi Devi, Door No. 35, West Krishnappa Gramani Garden, 3rd Street, Tondiarpet, Chennai 600 081. [PAN:CCHPK5677C] Vs. The Income Tax Officer, Non Corporate Ward 5(1), Chennai. (अपीलाथŎ/Appellant) (ŮȑथŎ/Respondent) अपीलाथŎ की ओर से / Appellant by : Shri Akshit Jain, CA ŮȑथŎ की ओर से/Respondent by : Ms. Deeptha, Addl. CIT सुनवाई की तारीख/ Date of hearing : 28.04.2025 घोषणा की तारीख /Date of Pronouncement : 14.05.2025 आदेश /O R D E R PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER: This appeal filed by the assessee is directed against the order dated 23.08.2023 passed by the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi for the assessment year 2017-18. 2. We find that this appeal is filed with a delay of 384 days. The assessee filed an affidavit for condonation of delay stating the reasons. Upon hearing both the parties and on examination of the said affidavit, I.T.A. No.2926/Chny/24 2 we find the reasons stated by the assessee are bonafide, which really prevented in filing the appeal in time. Thus, the delay is condoned and admitted the appeal for adjudication. 3. Ground No. 1 raised by the assessee is general in nature and requires no adjudication. 4. Ground Nos. 2 to 5 raised by the assessee in challenging the action of the ld. CIT(A) in confirming the addition made by the Assessing Officer on account of unexplained cash deposits under section 69 of the Income Tax Act, 1961 [“Act” in short]. 5. At the outset, it is noted that the Assessing Officer discussed the issue of cash deposits in para 8 of the assessment order, wherein, considering assessee’s reply, held no details of the financials of the assessee are visible and there is no provision to verify whether the opening cash balance is correct or not. The assessee contended that she had cash in hand of ₹.7,48,340/- as on 01.04.2014 and closing cash in hand of ₹.13,60,830/- as on 31.03.2016 at. Further, the assessee also shown closing cash in hand of ₹.20,205/- as on 08.11.2016. The Assessing Officer did not accept the same and added I.T.A. No.2926/Chny/24 3 the cash deposits to an extent of ₹.17,00,000/- as unexplained investments under section 69 of the Act. 6. The ld. CIT(A) discussed the issue in para 5.3 of the impugned order and it is noted that inspite of many opportunities afforded, the assessee could not submit relevant material in support of her contention regarding balance cash in hand as on 01.04.2014. Accordingly, the ld. CIT(A) confirmed the view of the Assessing Officer. 7. Before us, the ld. AR Shri Akshit Jain, CA submits that the assessee is a senior citizen from Rajasthan and settled in Chennai. The ld. AR drew our attention to para 4 of the order of this Tribunal in ITA No. 91/Chny/2024 dated 06.06.2024 passed in the case of Smt. Raniammal Subramaniam, wherein, the Tribunal allowed relief of 50% by holding that it is very natural tendency in the Indian families particularly ladies that they save cash at home. Accordingly restricted the addition to an extent of ₹.5,00,000/-. The ld. AR prayed to take lenient view in the present case with reference to the order of the Tribunal in the case of Smt. Raniammal Subramaniam (supra). 8. The ld. DR Ms. Deeptha, Addl. CIT, vehemently opposed the same and contended that there was no evidence before the Tribunal to I.T.A. No.2926/Chny/24 4 support the contention of the assessee and there is no material to give lenient view. Having considered the submissions of both parties, we find that the assessee has explained that the said cash deposits are from earning of tailoring and embroidering, but, however, we find no such explanation was shown before the Assessing Officer and the ld. CIT(A) except making the statement with such chart showing opening cash balance and closing cash in hand as on 31.03.2016. We note that there was no evidence to support the contention of opening cash in hand at ₹.7,48,340/- as on 01.04.2014. However, considering the earning and saving attitude of the ladies and by applying the ratio of this Tribunal in the case of Smt. Raniammal Subramaniam (supra), we confirm to the extent of closing cash in hand of ₹.7,48,340/- as on 01.01.2014 against the total addition of ₹.17,00,000/- and the balance addition of ₹.9,51,660/- [₹.17,00,000- ₹.7,48,340] stands deleted. Thus, the ground raised by the assessee is partly allowed. 9. Ground Nos. 6 & 7 raised by the assessee in challenging the action of the ld. CIT(A) in upholding the addition on account of differential value of the property on which the stamp duty was collected over and above the deed value of the property under consideration. I.T.A. No.2926/Chny/24 5 10. The Assessing Officer was of the opinion that the assessee along with another paid difference in stamp duty with regard to the value of the property to the tune of ₹.18,34,512/-. According to the Assessing Officer assessee’s share being 50% works out to ₹.9,17,256/-. A show cause notice was issued seeking objection why 50% being the difference in the value of the property at ₹.9,17,256/- should not be brought to tax under section 56(2)(vii)(b) of the Act. According to the Assessing Officer, the assessee objected the same and requested to refer the matter to the DVO. Since the assessment is time barring, the Assessing Officer, without awaiting DVO’s report, added the differential value in the property to the tune of ₹.9,17,256/- being assessee’s 50% share to the total income of the assessee under section 56(2)(vii)(b) of the Act. Aggrieved by the order of the Assessing Officer, the assessee preferred an appeal before the ld. CIT(A). The ld. CIT(A), having no submissions from the assessee, confirmed the addition made by the Assessing Officer. 11. Before us, the ld. AR submits that there was no difference in land value and sale consideration. He drew our attention to page 41 of the paper book and submits that the land value at ₹.53,62,500/- is same as with stamp valuation, but, however, there is alleged difference on I.T.A. No.2926/Chny/24 6 account of building value adopted by the assessee at ₹.16,37,500/- as against ₹.34,72,012/- by the registering authority. The ld. AR drew our attention to Annexure – 1A of paper book and contended that the building is 30 years old. The ld. AR argued that there is no value to the said old building and the value adopting registering authority is very high. He requested to adopt the value offered by the assessee. The ld. DR referred to the order of the ld. CIT(A). 12. Having heard both the parties and on perusal of the material available on record, we note that admittedly details of building were given in page 41 of the paper book and the Annexure – 1A attached to the sale deed, wherein, it is clearly noted that the age of the building is 30 years old and construction, which shows from para I to XII shows that it is a old construction. The assessee offered a sum of ₹.70,00,000/- for land and building, but, however, the stamp valuation authority valued the building for a sum of ₹.34,72,012/- and in consequence to which, the assessee paid differential stamp duty. Admittedly, there was no DVO’s report as on the date of impugned order passed by the ld. CIT(A) or even at the time of passing the assessment order. The ld. DR did not bring on record any DVO report in support of Assessing Officer’s contention. There being no DVO I.T.A. No.2926/Chny/24 7 report, we deem to proper to accept the contention of the assessee for valuing the property at ₹16,37,500/-. Therefore, the addition made on account of difference between the stamp duty value of building is deleted. Thus, the ground raised by the assessee is allowed. 13. In the result, the appeal filed by the assessee is partly allowed. Order pronounced on 14th May, 2025 at Chennai. Sd/- Sd/- (S.R. RAGHUNATHA) ACCOUNTANT MEMBER (S.S. VISWANETHRA RAVI) JUDICIAL MEMBER Chennai, Dated, 14.05.2025 Vm/- आदेश की Ůितिलिप अŤेिषत/Copy to: 1. अपीलाथŎ/Appellant, 2.ŮȑथŎ/ Respondent, 3. आयकर आयुƅ/CIT, Chennai/Madurai/Coimbatore/Salem 4. िवभागीय Ůितिनिध/DR & 5. गाडŊ फाईल/GF. "