MOSARRAT PERWEEN,KOLKATA V. ITO, WARD-61(4), KOLKATA

ITA 662/KOL/2024

AI Insights

The case involves Mosarrat Perween, a government teacher, who appealed against the order of the CIT(A) sustaining the addition of Rs. 15,00,000 to her income for the Assessment Year 2017-18. The addition was initially made by the AO, who alleged that the cash deposit during the demonetization period was unexplained. The CIT(A) upheld this addition, but the Tribunal found that the assessee had provided sufficient evidence, including a cash flow statement and bank statements, to prove that the deposit was from her savings and legitimate sources, not undisclosed income.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 23968 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAPIL MONDAL
• Assessee Lawyers: SOMNATH GHOSH
• Keywords: Salary income; Gift

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES “SMC”, KOLKATA BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.662/Kol/2024 Assessment Year: 2017-18 Mosarrat Perween, 1/7, G.J.K. Ghosh Road, Kolkata – 700 037, West Bengal PAN : AJIPP6389G V/s ITO, Ward-61(4), Kolkata Appellant Respondent आदेश / ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER : The captioned appeal pertaining to Assessment Year 2017- 18 at the instance of assessee is directed against the order dated 06.03.2024 passed by Addl/JCIT(A)-1, Lucknow u/s.250 of the Income-tax Act, 1961 (in short ‘the Act’) which in turn is arising out of Assessment Order dated 27.11.2019 passed u/s.143(3) of the Act. Assessee by : Shri Somnath Ghosh Revenue by : Shri Kapil Mondal Date of hearing : 25.11.2024 Date of pronouncement : 23.01.2025 ITA No.662/Kol/2024 Mosarrat Perween 2. Succinctly, the facts of the case are that the assessee is a Government Teacher and earning salary income and interest income from her savings. Income of Rs.5,82,530/- was declared in the return for the A.Y. 2017-18 filed on 28.08.2017. Subsequent to the processing of return u/s.143(1) of the Act, the case selected for scrutiny through CASS for examination of cash deposit made by assessee during the demonetization period. Statutory notices u/s.143(2)/142(1) were issued to the assessee calling upon her to furnish the source of cash deposit during demonetization period. There was no compliance to such notices from the side of assessee. Based on the assessee’s bank statements, ld. AO noticed an amount of Rs.15.00 lakh was deposited in her bank account maintained at UBI, Belgachia, Kolkata. The assessee furnished reply in response to show cause notice. Ld. AO found that the assessee was maintaining two accounts but has only declared only one account in the income-return filed. The AO after analyzing the cash withdrawals for the financial years 2013-14, 2014-15 and 2015-16 came to conclusion that there was no sufficient cash in hand to deposit the same into her bank account. The AO also observed that the assessee has invested in NSC by way of cash and the maturity proceeds are regularly credited in the Saving bank account in Belgachia Post Office. In this regard, ITA No.662/Kol/2024 Mosarrat Perween he has also analyzed the return of income shown by the assesee from A.Y. 2013-14 to 2017-18 and arrived at conclusion that the assessee is not having sufficient cash in hand. He therefore opined that since the assessee earns only salary income the source of investments in NSC remains unexplained. Eventually, ld. AO made addition of cash deposit Rs.15.00 lakh made during the demonetization period as unexplained income u/s.69A of the Act, rejecting the submissions of the assessee that it was made with her savings over a period of years. AO also made addition of Rs.47,086/- on account of failure of assessee to reflect one savings bank account. 3. Assessee contested before the ld.CIT(A) only the addition of cash deposit of Rs.15.00 lakh made by the AO. The ld.CIT(A) countenanced the action of the Assessing Officer by observing as under : “Paragraph no.4.8, 4.9, 4.10, 4.11 & 4.12 I have also gone through the paragraph no.s 4.8 & 4.9 of the assessment order, wherein, the claim of saving the money for purchasing a residential flat has been discussed. In these paragraphs, the A.O has clearly established the usage of cash for booking a flat on 28/10/2016. Therefore, I agree with the A.O's observation that, assessee had sufficient cash in hand from undisclosed sources out of which Rs.15,00,000/- was deposited in bank during demonetization and Rs.5,25,000/- was used to book a flat just few days prior to the declaration of demonetization, The onus was completely on the assessee to explain the sources of cash but she couldn't. Mere claim without the support of any documentary evidence doesn't make the assessee's claim reliable and fit for a ITA No.662/Kol/2024 Mosarrat Perween relief. Thus, the A.O, by an excellent marshalling of facts and a splendid analysis of financial data has in a highly logical manner concluded that, assessee had cash from some undisclosed sources of income. Similarly, in the paragraphs no. 4.10, 4.11 & 4.12, the A.O had rightly observed that, the assessee had disclosed a meager amount of total income in the last five assessment years. In these paragraphs, the A.O has established that, the assessee had no proper source of sufficient cash and the cash deposited in the bank during the demonetization was from undisclosed sources. These findings of the A.O are found to be correct. Ground of appeal no.3 & 4 : The assessee has submitted the grounds of appeal as : 3. The Ld. AO has erred in assuming that only current years income can be said to be deposited in Bank accounts. He also out of imagination, assumed that the assessee did not have any past savings nor she has accumulated stridhan and surpluses in her hand. His findings that as the salary incomes were withdrawn and have been spent by the assessee for her family expenses, ceremonies and medical needs etc does not carry any merit in absence of any tangible and corroborative evidence. The Ld. AO did have no basis for such conjectural imaginations. As such his action of addition of Rs. 15,00,000/- is liable to quashed and the assessment passed by him should be treated in nullity. 4. The assessee craves leave to add, alter, or withdraw any of the grounds of appeal before or at the time of hearing.\" I have also gone through this this ground along with the SOF submitted by the assessee. In this regard, my observation is that, mere claim that these cash deposits were out of Stridhan and past surpluses won't suffice. There should be documentary evidence to substantiate your claim. The assessee being non-responsive, it is deemed that, she has nothing to present. Also, there are no records of wealth tax returns to justify these claims. Hence, the assessee herself is basing her claim on conjectural imaginations in the absence of any tangible and corroborative evidence. Thus, this ground isn't tenable at all. ITA No.662/Kol/2024 Mosarrat Perween Thus, as discussed above, the A.O has arrived to the conclusion after a detailed analysis of the facts available on record as well as those submitted by the assessee. Further, the A.O has duly followed the procedure as laid down in the statute. Hence, the Assessing officer has correctly assessed after carrying out in-depth examination of facts available on record. Therefore, based upon merits too, the undersigned sees no reason to interfere with the orders of the Ld. Assessing Officer. Hence, all the grounds of appeal raised by the assessee are hereby dismissed. 6. Thus, as described in all the preceding paragraphs, the action of the AO is confirmed based on merits as well as on the non-compliance mode of the assessee and the grounds of appeal raised by the appellant are dismissed.” 4. Now the assessee is in appeal before the Tribunal challenging the impugned order passed by ld.CIT(A). 5. Ld. Counsel for the assessee referring to the paper book containing 36 pages submitted that the assessee is regularly filing the returns. The source for making the deposit is her savings over a period of time. She has filed all the details before the AO viz., cash flow statement, bank statement, financial statements etc. substantiating the source of cash deposit of Rs.15.00 lakh. The assessee has sufficient funds available to her credit. The authorities were not justified in making addition of said sum. He therefore submitted that the impugned order be reversed deleting the addition. ITA No.662/Kol/2024 Mosarrat Perween 6. On the other hand, ld. DR vehemently argued supporting the orders of the lower authorities. 7. I have heard both the sides and perused the record placed before me. The solitary issue that arises for my consideration is whether the authorities below were justified in confirming the addition of cash deposit of Rs.15.00 lakh. In the instant case, the assessee is a salaried Govt. employee deriving income from salary and interest from savings and made cash deposit of Rs.15.00 lakh in the United Bank of India, Belgachia branch during the demonetization period. It was stated by the assessee that the said deposit was made from her savings over a period of time. The money was withdrawn from time to time as per the requirement and it was utilized for purchasing the flat. In this regard, ld. AO in para No.4.7 of the assessment order has drawn a chart indicating wherein cash withdrawals made by the assessee in the previous financial years 2013-14 to 2015-16 which aggregate to Rs.14,15,000/-. The assessee also submitted cash flow statement and financials to substantiate that the deposit was made out of the genuine source which of course is from her salary and interest. The contention of the assessee that she received certain gifts from the father, mother and relatives also cannot be ruled out. The authorities have nowhere rejected the financials submitted by the assessee and have not brought anything on record which goes to prove that ITA No.662/Kol/2024 Mosarrat Perween the assessee has received cash from undisclosed sources. In the absence of any material contrary, the authorities were not justified in making the addition. I therefore order to delete the addition of Rs.15.00 lakh made by the AO and sustained by the CIT(A). Grounds of appeal raised by the assessee are allowed. 8. In the result, the appeal of the assessee is allowed. Order pronounced on this 23rd day of January, 2025. - Sd/- (MANISH BORAD) ACCOUNTANT MEMBER पुणे/Pune; \u0001दनांक / Dated : 23rd January, 2025 Satish आदेश क\u0002 \u0003ितिलिप अ\tेिषत / Copy of the Order forwarded to : 1. अपीलाथ\f / The Appellant. 2. \r\u000eयथ\f / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय \rितिनिध, आयकर अपीलीय अिधकरण, “(SMC)” ब\u0014च, Kolkata/ DR, ITAT, “(SMC)” Bench, Kolkata. 5. गाड\u0018 फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Assistant Registrar, ITAT, Kolkata "