AI Insights
The case involves an appeal by the legal heir of the deceased assessee, Shri Prakash Basappa Sankh, against the order of the lower authorities which treated certain cash deposits as unexplained money under section 69A of the Income Tax Act. The assessee had initially filed a return which was accepted, but following a revision under section 263, the matter was re-assessed due to unexplained cash deposits amounting to Rs. 6,34,500. The legal heir provided explanations and documents to substantiate the sources of these deposits, claiming they were from agricultural activities and savings. However, the lower authorities did not accept these explanations, leading to the appeal before the Tribunal.
Appeal details
Counselvise Citation
[2025] 140 COUNSELVISE.COM (IT) 667620 (ITAT-BANGALORE)
Assessee PAN
Bench
Appeal Number
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
26-06-2025
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
SMC
Assessment Year
2017-2018
Judgement Text
"IN THE INCOME TAX APPELLATE TRIBUNAL SMC-‘C’ BENCH : BANGALORE BEFORE SHRI PRASHANT MAHARISHI, VICE – PRESIDENT AND SHRI SOUNDARARAJAN K., JUDICIAL MEMBER ITA No. 2370/Bang/2024 Assessment Year : 2017-18 Shri Prakash Basappa Sankh Rep by L/H Rahul Prakash Sankh, Teacher, Govt. Kannada Boys School, S S Road Bijapur Bazar, P O Bijapur – 586 101. Karnataka. PAN: CDUPS8403A Vs. The Income Tax Officer, Ward – 1 & TPS, Bijapur. APPELLANT RESPONDENT Assessee by : Smt. Prathiba R, Advocate Revenue by : Shri Ganesh R Gale, Standing Counsel for Dept. Date of Hearing : 16-04-2025 Date of Pronouncement : 26-06-2025 ORDER PER SOUNDARARAJAN K., JUDICIAL MEMBER This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 19/11/2024 in respect of the A.Y. 2017-18 and raised the following grounds: Page 2 of 5 ITA No. 2370/Bang/2024 Page 3 of 5 ITA No. 2370/Bang/2024 2. The assessee filed his return of income in response to the notice issued u/s. 142(1) of the Act. Thereafter the return was accepted on 22/11/2019. Subsequently, based on the order passed u/s. 263 of the Act by the PCIT, Hubli, the assessment was taken up for further adjudication since the assessee had made a cash deposit of Rs. 6,34,500/-. The assessee contended that the said income is out of the agricultural activities and the savings made by him and his wife. In the meanwhile the assessee died. Since no evidences were furnished in support of their claim, the AO issued notices to the assessee for which the legal heir of the assessee replied and enclosed the copy of the death certificate of the assessee. Then the legal heir of the assessee filed his reply electronically and enclosed some documents in support of the income declared by his deceased father. The AO had not accepted the explanations offered by the legal heir of the deceased assessee and treated the said deposits as unexplained money u/s. 69A of the Act. The AO had made the assessment u/s. 144 r.w.s. 263 of the Act in the name of the deceased assessee. As against the said order of the AO, the assessee filed this appeal before the Ld.CIT(A). The assessee also explained the source of income earned by the assessee but the Ld.CIT(A) had not accepted the explanation offered by the assessee and dismissed the appeal. Page 4 of 5 ITA No. 2370/Bang/2024 3. As against the said order, the assessee is in appeal before this Tribunal. 4. At the time of hearing, the Ld.AR submitted that the assessee is earning income through agriculture and also earned income from various agriculturists to whom the assessee had identified the borewell points. The Ld.AR further submitted that the assessee also died after the order accepting the return was passed and therefore prayed to consider the documents filed before the authorities and grant the benefit. 5. The Ld.DR relied on the orders of the lower authorities and prayed to dismiss the appeal. 6. We have heard the arguments of both sides and perused the materials available on record. 7. In this appeal, the total addition made by the AO is about Rs. 6,31,000/- being the income received by way of agricultural income and also income earned through the agriculturists for identifying the borewell points. Admittedly, the assessee also died and only the legal heirs are before us by disputing the said addition made by the AO u/s. 69A of the Act. 8. We have also perused the acknowledgement dated 28/04/2023 in which the assessee had attached the agricultural income proof and letters from persons for having paid the honorarium and the death certificate of the assessee. From the said attachments, we understand that the legal heir of the assessee had tried to explain the source for the income earned by his deceased father. By taking into consideration the fact that the assessee was no more and the cash deposited into the bank account are only the minimum amount and also considering the fact that the legal heir of the assessee had furnished some documents in support of the said claim, we are inclined to allow the appeal filed by the assessee. We also find that the Page 5 of 5 ITA No. 2370/Bang/2024 assessment order dated 31/03/2023 was made on the deceased assessee which in our view is also bad in law and therefore the assessment could also be interfered on this ground by setting aside the same. 9. In the result, the appeal filed by the assessee is allowed. Order pronounced in the open court on 26th June, 2025. Sd/- Sd/- (PRASHANT MAHARISHI) (SOUNDARARAJAN K.) Vice – President Judicial Member Bangalore, Dated, the 26th June, 2025. /MS / Copy to: 1. Appellant 2. Respondent 3. CIT 4. DR, ITAT, Bangalore 5. Guard file 6. CIT(A) By order Assistant Registrar, ITAT, Bangalore "
Mehul