NEETA JIGENSH VASARIYA,BHAYANDER WEST V. ITO WARD 3(1), THANE

ITA 3101/MUM/2025

AI Insights

The case involves Neeta Jigensh Vasariya, the Appellant, who contested an order from the National Faceless Appeal Centre (NFAC) which upheld an addition of INR 10,85,000 to her income for the Assessment Year 2017-2018. This addition was initially made by the Income Tax Officer under Section 143(3) of the Income Tax Act, 1961, due to unexplained cash deposits during the demonetization period. The CIT(A) dismissed her appeal, noting a lack of evidence to substantiate the source of these deposits. The ITAT, considering the circumstances including the Assessee's health issues and the delay in filing the appeal, decided to condone the delay and remand the case for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 711294 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: misc
• Other Referred Cases: Collector of Land Acquisition Vs. Mst. Katiji & others AIR 1987 1353 (SC)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ASSESSEE
• Keywords: Set aside; Opportunity of being heard; Reasonable cause; Corroborative evidences; Source of fund; Assessment record
• Section: 143(3)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “H (SMC)” BENCH, MUMBAI SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER ITA No.3101/MUM/2025 (Assessment Year: 2017-2018) Neeta Jigensh Vasariya 304, Ruchhi Tower, 60 Feet Road, Thane – 401101, Maharashtra. [PAN:AIBPV7931N] …………. Appellant Income Tax Officer Ward 3(1), Mumbai ASAR IT Park, Thane – 400604 Vs …………. Respondent Appearance For the Appellant/Assessee For the Respondent/Department : : Shri Akshit Kothari Shri Pravin Salunkhe Date Conclusion of hearing Pronouncement of order : : 17.07.2025 22.07.2025 O R D E R [ Per Rahul Chaudhary, Judicial Member: 1. The present appeal preferred by the Assessee is directed against the order, dated 19/12/2022, passed by the National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘the CIT(A)’] under Section 250 of the Income Tax Act, 1961 [hereinafter referred to as ‘the Act’] whereby the Ld. CIT(A) had dismissed the appeal against the Assessment Order, dated 05/11/2019, passed under Section 143(3) of the Act for the Assessment Year 2017-2018. 2. The Assessee has raised following grounds of appeal : “1. Honoured officer while computing my total income did added my income for year shown in return for year 2017 of Rs.2,58,710/- also with my genuine cash deposit and charged on entire amount under sec. 115BBE @ 60% for this error we had filled rectification request for appeal hoping its Printed from counselvise.com ITA No.3101/Mum/2025 Assessment Year 2017-2018 2 rectification of error and didn’t applied for vivaad to viswas scheme but even after 2 years there is no update on our rectification request by department so now we are filling ITAT Appeal request to consider the same I hereby assure department that above cash deposit of Rs.10,86,000/- is my genuine cash and can prove the same if provided an opportunity of being heard .” 3. The relevant facts in brief are that the assessment under Section 143(3)/144 of the Act was framed on the Assessee vide Assessment Order, dated 05/11/2019 whereby an addition of INR.10,85,000/- was made in the hands of the Assessee under Section 69A of the Act to the returned of income of INR.2,58,710/-. The aforesaid addition was made in respect of cash deposits made by the Assessee in specified bank notes during the demonization period on the ground that the Assessee had failed to disclose the source of the aforesaid cash deposits. 4. Being aggrieved, the Assessee preferred appeal before the CIT(A) in physical form which was later migrated to National Faceless Appeal Centre (NFAC). The aforesaid appeal were disposed off by the Learned CIT(A) vide order, dated 19/12/2022. The CIT(A) dismissed the grounds raised by the Assessee observing that the Assessee had failed to bring on record supporting evidence to establish the source of cash and to corroborate the contention that the Assessee was holding cash from the Financial Year 2009-2010 to Financial Year 2016-2017. 5. Being aggrieved, the Assessee has preferred the present appeal before the Tribunal against the above order passed by the CIT(A). The registry had marked a delay of 607 days in filing the appeal. The Learned Authorized Representative for the Assessee at the outset submitted that the delay in filing the present appeal was not deliberate and was on account of bonafide reasons. It was submitted that the Assessee was a housewife who had been earning income over past 8 to 10 years by giving tuitions, providing part time part Printed from counselvise.com ITA No.3101/Mum/2025 Assessment Year 2017-2018 3 time cooking service, part time beauty parlour service and mehandi work. The cash income thus earned by the Assessee had been regularly disclosed and offered to tax in the Income Tax returns filed by the Assessee. It was further submitted that during the relevant period her husband was also working and therefore, the family had had sufficient source for meeting living expenses and aggregating cash savings of INR.10,86,000/- over a period of 8 to 10 years. The Learned Authorized Representative for the Assessee further submitted that the husband of the Assessee had subsequently suffered from kidney failure and required medical attention. On account of the same proper representation could not be made by the Assessee before the Learned CIT(A). It was further submitted that the Assessee had also filed application for rectification vide Request No.111918770080423 which was not been disposed off till date. In view of the aforesaid facts it was prayed on behalf of the Assessee that the delay in filing the present appeal be condoned and the Assessee be granted another opportunity to establish the source of funds deposited in the bank accounts during the relevant previous year. 6. Per contra it was submitted by the Learned Departmental Representative that despite having been granted sufficient opportunity during the assessment as well as appellate proceedings the Assessee had failed to bring on record relevant material to show the source of cash deposits. It was further submitted that Learned CIT(A) had issued hearing notice dated 04/11/2022 and 01/12/2022 to the Assessee and in response to the same the Assessee had failed to bring on record corroborative evidence. Therefore, there was no infirmity in the order passed by the CIT(A) dismissing the appeal preferred by the Assessee. 7. We have given thoughtful consideration to the rival submissions and have perused the material on record. It has not been disputed by Printed from counselvise.com ITA No.3101/Mum/2025 Assessment Year 2017-2018 4 the Revenue that the Assessee had filed return of income for the Financial Year 2009-2010 to Financial Year 2015-2016 and had disclosed income in excess of INR.1,50,000/- for the aforesaid each of the said financial years. During the appellate proceedings before the CIT(A), the Assessee had taken a stand that income earned by the Assessee during the aforesaid period was supported by income earned by her husband and the couple had sufficient income to meet the household expenses and to save money. We note that the CIT(A) has reproduced the relevant extract of the ‘Statement of Facts’ filed by the Assessee before the CIT(A) wherein it has been stated that the first online submission was made by the Assessee before the Assessing Officer on 16/09/2018 in response to notice dated 17/08/2018 issued under Section 143(2) of the Act fixing the hearing on 03/09/2018. By of the aforesaid submission the Assessee had placed before the Assessing Officer note of business activity, computation of income, capital account, balance sheet, bank statements alongwith evidence for source of cash deposited. In the statement of facts, the Assessee had taken a stand that in response to show cause notice, dated 11/10/2019, issued by the Assessing Officer, the Assessee had stated that her husband was facing health issues on account of some problem with the kidney and therefore, she was not able to gather relevant details and documents to establish the source of cash deposits. It was explained that the purpose of aggregating cash was to invest in a residential flat. However, we find that neither the CIT(A) nor the Assessing Officer has not taken into consideration the aforesaid submissions of the Assessee. The Assessing Officer has made the addition after observing that the Assessee had failed to respond to notice dated 11/10/2019 while the CIT(A) has concluded that despite having been granted sufficient opportunities the Assessee had failed to bring on record supportive evidence. There is not finding in relation to return of income filed by the Assessee and her husband. The orders passed Printed from counselvise.com ITA No.3101/Mum/2025 Assessment Year 2017-2018 5 by the authorities below are silent about the submission, dated 126/09/2018, containing note of business activity, computation of income, capital account, balance sheet, bank statements alongwith evidence for source of cash deposited, claimed to have been filed by the Assessee. Though the relevant facts formed part of the statement of record, no finding was returned by the CIT(A) in this regard even to the effect that the Assessee had not filed such submissions. We note that the Assessee has explained that the proper representation could not be made before the CIT(A) on account of medical issues faced by her husband and for the same reasons there was a delay in filing the present appeal. In the case of Collector of Land Acquisition Vs. Mst. Katiji & others AIR 1987 1353 (SC) the Hon’ble Supreme Court has, while dealing with the issue of condonation of delay, emphasized that substantial justice should prevail over technical considerations. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. Having considered the totality of the facts and circumstances of the present case, we deem it appropriate to condone the delay of 671 days in filing the present appeal as we are of the considered view that the Assessee was prevented by reasonable cause from filing the present appeal before this Tribunal. The addition of INR.10,85,000/- made in the hands of the Assessee is set aside, with the directions to the Assessing Officer to decide the issue afresh after granting the Assessee a reasonable opportunity of being heard. The Assessee is directed to file before the Assessing Officer all documents/details to establish the source of cash deposit of INR.10,85,000/- in the bank account of the Assessee. The Assessing Officer is directed to consider the documents/details so filed by the Assessee. It is clarified that the Assessing Officer would be at liberty to carry out such inquiry/verification as the Assessing Printed from counselvise.com ITA No.3101/Mum/2025 Assessment Year 2017-2018 6 Officer may deem fit. Further, in case the Assessee failed to enter appearance before the Assessing Officer and/or fails to furnish the supporting documents/details/submission, the Assessing Officer would be at liberty to adjudicate the issue on merits based on the material already forming part of the assessment record including the online submissions filed by the Assessee. In terms of the aforesaid, ground raised by the Assessee is allowed for statistical purposes. 8. In result the appeal preferred by the Assessee is allowed for statistical purposes. Order pronounced on 22.07.2025. Sd/- Sd/- (Om Prakash Kant) Accountant Member (Rahul Chaudhary) Judicial Member मुंबई Mumbai; िदनांक Dated : 22.07.2025 Milan,LDC Printed from counselvise.com ITA No.3101/Mum/2025 Assessment Year 2017-2018 7 आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : 1. अपीलाथŎ / The Appellant 2. ŮȑथŎ / The Respondent. 3. आयकर आयुƅ/ The CIT 4. Ůधान आयकर आयुƅ / Pr.CIT 5. िवभागीय Ůितिनिध ,आयकर अपीलीय अिधकरण ,मुंबई / DR, ITAT, Mumbai 6. गाडŊ फाईल / Guard file. आदेशानुसार/ BY ORDER, सȑािपत Ůित //True Copy// उप/सहायक पंजीकार /(Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, मुंबई / ITAT, Mumbai Printed from counselvise.com "