MS. SHIVANI,MEERUT V. DCIT- CENTRAL CIRCLE, GHAZIABAD

ITA 5214/DEL/2024

AI Insights

The case involves appeals by Ms. Shivani against the penalties imposed by the Deputy Commissioner of Income Tax, Central Circle, Ghaziabad, for the assessment years 2014-15 and 2015-16. The penalties were based on alleged unexplained cash deposits amounting to INR 5,06,497 for AY 2014-15 and INR 14,21,455 for AY 2015-16, which were added to her income. The AO's satisfaction regarding the imposition of penalties was found to be vague and non-descript, leading to the Tribunal's decision to reverse the penalties. The Tribunal also considered the appellant's argument that the cash withdrawn and subsequently deposited was from her household expenses, which the AO had not adequately addressed.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 41727 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2014-2015
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAHIL KUMAR BANSAL
• Assessee Lawyers: RAGINI HANDA
• Keywords: Unexplained cash credit
• Section: 271(1)(c)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “G” BENCH: NEW DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ITA Nos.5214 & 5215/Del/2024 [Assessment Years : 2014-15 & 2015-16] Ms. Shivani House No.4, Krishna Garden, Ganga Nagar Meerut-250001 PAN-DSGPS6952E vs DCIT Central Circle Ghaziabad APPELLANT RESPONDENT Appellant by Ms. Ragini Handa, Adv. Respondent by Shri Sahil Kumar Bansal, Sr. DR Date of Hearing 19.03.2025 Date of Pronouncement 26.03.2025 ORDER PER PRADIP KUMAR KEDIA, AM : The captioned appeals have been filed at the instance of the assessee seeking to assail the First Appellate order dated 10.10.2024 passed by Commissioner of Income Tax (A)-3, Noida [“CIT(A)”] under s. 250(6) of the Income Tax Act, 1961 [“the Act”] arising from the assessment order dated 17.12.2019 passed under s. 143(3)/153A of the Act pertaining to assessment years 2014-15 & 2015-16 respectively. 2. As per the respective appeals for AYs 2014-15 & 2015-16, the assessee has challenged the imposition of penalty under s. 271(1)(c) of the Act on alleged unexplained cash deposits. 3. For AY 2014-15, the addition of INR 5,06,497/- was made towards alleged cash deposits on the returned income of INR 9,95,560/-. Similar additions towards alleged unexplained cash credits were made for AY 2015-16 is INR 14,21,455/-. The AO has imposed penalty on such additions. 4. In the matter, we firstly, note that while framing the assessment order the AO has made a simplicitor observation stating ‘penalty proceedings under s. 271(1)(c) of the I.T. Act are being initiated separately’. Thus, the ITA Nos.5214 & 5215/Del/2024 Page | 2 nature of ‘satisfaction’ arrived towards charge contemplated under s. 271(1)(c) of the Act is not known. It is trite that the AO has to draw satisfaction qua the alleged ‘concealment of particulars of income’ or ‘furnishing inaccurate particulars of income’ as the case may be. The satisfaction towards the charge against the assessee in the instant case is vague, non-descript and thus susceptible. Secondly, it is the case of the assessee that she has withdrawn cash amount from time to time which has been deposited and thus source of cash deposits ought not to have been doubted in the quantum proceedings itself. 5. Be that as it may, the AO has made additions on the ground that cash withdrawals which is claimed to be source of deposits has been actually utilized for household expenses and thus cash deposits remains unexplained. The action of the AO is in the realm of probabilities. 6. The penalty under s. 271(1)(c) is dependent upon statutory discretion of the AO in such cases. The statutory discretion in the facts of the present case, to our mind, ought to have been exercised in favour of the assessee. 7. Thus in totality, penalty imposed under s. 271(1)(c) of the Act appears to be grossly unjustified and therefore, reversed. 8. In the result, the captioned appeals of the assessee are allowed. Order pronounced in the open Court on 26th March, 2025. Sd/- Sd/- (VIKAS AWASTHY) JUDICIAL MEMBER (PRADIP KUMAR KEDIA) ACCOUNTANT MEMBER *Amit Kumar, Sr.P.S* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI ITA Nos.5214 & 5215/Del/2024 Page | 3 "