SAHIL PHUTELA,AMBALA CITY V. INCOME TAX OFFICER, WARD-4, AMBALA, AMBALA

ITA 342/CHANDI/2025

AI Insights

The case involves Shri Sahil Phutela, the appellant, who is engaged in retail trading under the name Shri Paramhans Traders. For the Assessment Year 2017-18, the appellant deposited Rs.30.17 Lacs in cash into his SBI Bank account, which led to a reassessment under section 147 read with section 144B of the Income Tax Act by the Assessing Officer. The appellant's failure to substantiate the source of these deposits resulted in their addition as unaccounted money under section 69A. The Commissioner of Income Tax (Appeals) upheld this addition, prompting the appellant to appeal before the Income Tax Appellate Tribunal. The Tribunal recognized the nature of the appellant's business, which involved substantial cash transactions, and accepted a portion of the deposits as accounted business income, thus reducing the addition to Rs.2 Lacs.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 714249 (ITAT-CHANDIGARH)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RANJIT KAUR LD.
• Assessee Lawyers: TEJ MOHAN SINGH LD
• Keywords: Business income
• Section: 147

Judgement Text

"1 IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, CHANDIGARH HYBRID HEARING BEFORE HON’BLE SHRI RAJPAL YADAV, VICE PRESIDENT AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपीलसं./ ITA No.342/CHANDI/2025 (िनधाŊरणवषŊ / Assessment Year: 2017-18) Shri Sahil Phutela C/o Tehmohan Singh (Advocate) # 527 Sector 10-D Chandigarh 160011. बनाम/ Vs. ITO Ward-4 Ambala. ̾थायीलेखासं./जीआइआरसं./PAN/GIR No.CMVPP-7771-G (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎ की ओर से / Appellant by : Shri Tejmohan Singh (Advocate) – Ld. AR ŮȑथŎ की ओर से / Respondent by : Dr. Ranjit Kaur (Addl. CIT) – Ld. Sr.DR सुनवाई की तारीख / Date of Hearing : 17-07-2025 घोषणा की तारीख / Date of Pronouncement : 04-08-2025. आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeals by assessee for Assessment Year (AY) 2017- 18 arises out of an order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 07-11-2024 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 147 r.w.s. 144B of the Act on 28-03-2022. The registry has noted delay of 35 days in the appeal which stand condoned. The sole issue in the appeal is addition of cash deposit for Printed from counselvise.com 2 Rs.30.17 Lacs. Having heard rival submissions and upon perusal of case records, the appeal is disposed-off as under. 2. The assessee carried out business in the name of Shri Paramhans Traders and declared income for Rs.4.63 Lacs. It transpired that the assessee deposited cash of Rs.30.17 Lacs in its SBI Bank account and accordingly, the case was reopened. The assessee failed to make any effective representation and accordingly, Ld. AO added the deposits u/s 69A. The Ld. CIT(A) confirmed the assessment for the same very reasons against which the assessee is in further appeal before us. 3. From case records, it emerges that the assessee is engaged in retail trading wherein most of the sales happen in cash. The assessee is subjected to VAT and it has duly maintained the cash book for its business. The cash deposits are sourced out of cash generated by the assessee in its business. The sales turnover of the assessee is evidenced by VAT returns as placed on record. The assessee regularly deposit cash in the bank account owing to nature of its business. On these facts, entire deposits could not be held to be unaccounted money of the assessee. Since the assessee has remained non-compliant and failed to fully substantiate its claim, to plug any possible leakage of revenue, we confirm lumpsum addition of Rs.2 Lacs as business income over and above the regular income as declared by the assessee. The remaining addition stand deleted. The Ld. AO is directed to re-compute the income of the assessee. No other ground has been urged in the appeal. Printed from counselvise.com 3 4. The appeal stand partly allowed. Order pronounced on 04-08-2025. Sd/- Sd/- (RAJPAL YADAV) (MANOJ KUMAR AGGARWAL) VICE PRESIDENT ACCOUNTANT MEMBER Dated: 04-08-2025. आदेश की Ůितिलिप अŤेिषत /Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT CHANDIGARH Printed from counselvise.com "