KULVINDER KAUR SANDHU ,PUNE V. DCIT CIRCLE - 8 , PUNE

ITA 2870/PUN/2025

AI Insights

The case involves Kulvinder Kaur Sandhu, the Assessee, who appealed against the order of the CIT(A) concerning the assessment year 2013-14. The primary issues in the appeal were the addition of Rs. 16,35,000 as unexplained cash deposits and an additional Rs. 1,34,985 added to the business income due to a lower reported net profit percentage in the transport business. The ITAT found that the CIT(A) had not provided sufficient evidence to support the standard profit percentage of 8% in similar businesses, leading to the deletion of the latter addition. However, the addition of Rs. 16,35,000 was upheld due to lack of evidence from the Assessee to substantiate the source of these deposits.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 841217 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2026
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 28-11-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SHRADDHA NICHAL
• Assessee Lawyers: A.M.SADAVARTE; A.V.IYER
• Keywords: Business income
• Section: 143(3)

Judgement Text

" आयकर अपीलीय अधिकरण ”बी” न्यायपीठ पुणे में। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “B” :: PUNE BEFORE MS.ASTHA CHANDRA, JUDICIAL MEMBER AND DR.DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपऩल सं. / ITA No.2870/PUN/2025 निर्धारण वषा / Assessment Years: 2013-14 Kulvinder Kaur Sandhu, Flat No.C-10, Narmada Park, Medankarwadi, Chakan Taluka – Khed, Pune – 410501. Vs. DCIT, Circle-8, Pune. PAN: APSPS5896M Appellant/ Assessee Respondent / Revenue Assessee by Shri A.M.Sadavarte and Shri a.v.Iyer Revenue by Smt Shraddha Nichal – Addl.CIT(DR) Date of hearing 02/02/2026 Date of pronouncement 24/02/2026 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This is an appeal filed by the Assessee against the order of ld.Commissioner of Income Tax(Appeal)[NFAC], passed under section 250 of the Income Tax Act, 1961 for the A.Y.2013-14 dated 25.09.2025 emanating from the Assessment Order passed under section 143(3) of the Act, dated 18.03.2016. The Assessee has raised the following grounds of appeal : Printed from counselvise.com ITA No.2870/PUN/2025 [A] 2 “The following Grounds are taken without prejudice to each other: On the facts and in law 1. The Hon. CIT Appeals (NFAC) has erred in Making an addition of Rs.1,34,985/-, on the ground that Net Profit percentage shown by assessee is at 7.32%, whereas 8% is the normal profit in Transport business. 1.2 The addition is not justified on the following grounds: a) Hon'ble CIT Appeals has presumed that, the usual Net Profit in line of Transport Business is 8% and assessee has shown Net Profit at 7.32%. b) The addition can not be made on the basis of presumption not supported by any facts and without any justification 2. The Hon. CIT Appeals (NFAC) has erred in Confirming an addition of Rs. 16,35,000/-, made by the learned AO, on account of Cash Deposit in the Bank Account of assessee. 1.2 The addition is not justified on the following grounds: a) The assessee receives cash from Individuals and small firms for providing service. These sales have been duly reflected in the Sales Account, depicted in Profit and Loss Account. b) Due to very nature of business carried on by assessee, she has to withdraw huge cash from bank to be given to drivers for filling in Diesel, to make payment of Toll and Octroi, to meet their food expenses etc. Once the drivers return the remaining cash is again received and deposited in bank by assessee. c) There are huge withdrawals from Bank also, which are at times redeposited in bank. 3. Your appellant prays leave to produce such other evidence as may be necessary to substantiate its case. Printed from counselvise.com ITA No.2870/PUN/2025 [A] 3 4. The appellant craves leave to add, amend, modify, or delete any of the grounds of appeal at or before the hearing.” Findings & Analysis : 2. We have heard both the parties and perused the records. 2.1 In this case, the Assessee had filed Return of Income on 19/09/2014 for A.Y.2013-14 declaring Total Income at Rs.33,74,810/-. It is mentioned in the Assessment Order that Assessee is in the Business of Transport. 3. Assessee’s case was selected for scrutiny for verification of Cash Deposits and on account of lower Income from House Property. During Scrutiny proceedings the Assessee has not filed any submission before the AO hence AO made addition of Rs.16,35,000/- which was the cash deposit. During scrutiny proceedings the AO also noted that Income from House Property was less in the Return of Income as compared that which was appearing in 26AS. AO made addition under the head Income From House Property of Rs.1,14,13,321/-. 4. Aggrieved by the Assessment Order the Assessee filed Appeal before the ld.CIT(A). Printed from counselvise.com ITA No.2870/PUN/2025 [A] 4 5. The Ld.CIT(A) held as under : “As discussed elsewhere in the order, there is a difference of Rs.9,88,243/- in the receipts shown in 26AS at Rs.2.24,74,097/- and receipts shown in the return at Rs.2.14,85,854/-. The difference of Rs.9.88.243/- needs to be added to the returned income and no expenditure should be allowed as expenditure had been already claimed. Therefore, the AO is directed to make addition of Rs.9,88,243/- The appellant had shown gross receipts of Rs.2,14,85,854/- in the return of income and shown the net profit to the tune of Rs. 15,72,860/- which comes to 7.32%. In this line of business, the minimum profit would be of 8%. The AO is directed to add the difference of Rs.1,34,985/- ((gross receipts of Rs.2.14,85,854-cash deposit of Rs. 16,35,000/-)*0.68/100)] on account of business income. Coming to the cash deposits of Rs. 16,35,000/-, the appellant did not furnish any evidence regarding the alleged commission earned by her during the year. Therefore, the addition made by the AO is upheld. The assessment order passed by the AO and addition made is modified as under 1. Returned income Rs.33,74,810/- 2. Addition on account of difference in receipts Rs.9,88,243/- 3. Business income Rs.1.34.985/- 4. Cash deposits Rs. 16,35,000/- Total Rs.61,33,038/- Printed from counselvise.com ITA No.2870/PUN/2025 [A] 5 The AO has erred in treating the receipts as income from house property, which is not correct as per 26AS. Therefore, the addition made stands deleted and the income was determined at Rs.61,33,038/- as per the available material on record. 6. In the result, the appeal filed by the appellant against order u/s. 143(3) of the Act for the AY 2013-14 is partly allowed.” 5.1 Thus, the Ld.CIT(A) partly allowed appeal of the Assessee. Ld.CIT(A) has given findings that Assessee had not filed any explanation before Ld.CIT(A) regarding cash deposits, hence ld.CIT(A) upheld the addition of Rs.16,35,000/- 6. Aggrieved by the Order of Ld.CIT(A) the Assessee filed appeal before the ITAT. 7. Regarding the cash deposits the Assessee had claimed that it was sourced out of withdrawals. We have read the explanation but we are not convinced that the Cash Deposits were sourced from withdrawals. Also other than just the claim, the Assessee has not filed any evidence to prove that. Also the Assessee had not filed any explanation before AO and ld.CIT(A). Printed from counselvise.com ITA No.2870/PUN/2025 [A] 6 8. In these facts and circumstances of the case we uphold the order of the Ld.CIT(A) sustaining the addition of Rs. 16,35,000/-. Accordingly, Ground No.2 of the Assessee is dismissed. 9. As far as estimation of profit at 8% by Ld.CIT(A) is concerned Ld.CIT(A) has not brought on record any evidence of comparable case where 8% profit was shown in identical case. Therefore, we are of the opinion that addition of Rs.1,34,985/- is without any basis hence not sustainable. Accordingly, we direct AO to delete the addition of Rs.1,34,985/-. 10. Accordingly, Ground No.1 of the Assessee is allowed. 11. Ground Numbers 3 & 4 are general in nature, no ground was added or altered. Accordingly, ground number 3 & 4 are dismissed. 12. In the result, Appeal of the Assessee is partly allowed. Order pronounced in the open Court on 24 February, 2026. Sd/- Sd/- ASTHA CHANDRA Dr.DIPAK P. RIPOTE JUDICIAL MEMBER ACCOUNTANT MEMBER पपणे / Pune; ददिधंक / Dated : 24 Feb, 2026/ SGR Printed from counselvise.com ITA No.2870/PUN/2025 [A] 7 आदेशकीप्रनिनलनपअग्रेनषि / Copy of the Order forwarded to : 1. अपऩलधर्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. नवभधगऩयप्रनिनिनर्, आयकर अपऩलऩय अनर्करण, “बऩ” बेंच, पपणे / DR, ITAT, “B” Bench, Pune. 6. गधर्ाफ़धइल / Guard File. आदेशधिपसधर / BY ORDER, // TRUE COPY // Assistant Registrar आयकर अपऩलऩय अनर्करण, पपणे/ITAT, Pune. Printed from counselvise.com "