TRUPTI SHUKLA, RAJNANDGAON,RAJNANDGAON V. INCOME TAX OFFICER - 1, RAJNANDGAON, RAJNANDGAON

ITA 461/RPR/2025

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The case involves Trupti Shukla, who, along with her husband, had a joint bank account where significant cash deposits were made during the demonetization period. The Income Tax Department added these deposits as unexplained money under section 69A of the Income Tax Act, 1961, and charged them at a higher tax rate under section 115BBE. The assessee contested that the deposits were made by her husband from his business activities and past savings, and not adequately considered by the Revenue. The Tribunal found that the Revenue's actions were arbitrary and not in accordance with the law, leading to the allowance of the assessee's appeal.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 836621 (ITAT-RAIPUR)
• Duration Of Justice: 6 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Appeal Filed On: 28-07-2025
• Other Referred Cases: Mehta Parikh & Co. Vs. CIT, Sudarsan De Vs. DCIT, Circle-2(2)(1)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRIYANKA PATEL
• Assessee Lawyers: RAKESH DHODY
• Keywords: Income from undisclosed sources; Principle of natural justice; Source of fund
• Section: 143(3); 263

Judgement Text

"आयकर अपीलȣय अͬधकरण Ûयायपीठ रायपुर मɅ। IN THE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH, RAIPUR BEFORE SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER AND SHRI AVDHESH KUMAR MISHRA, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No. 461/RPR/2025 Ǔनधा[रण वष[ / Assessment Year : 2017-18 Trupti Shukla D-42, Mahavir Sun City Lakholi Road, Rajnandgaon (C.G.)-491 441 PAN: BDDPS2254P ........अपीलाथȸ / Appellant बनाम / V/s. The Income Tax Officer-1, Rajnandgaon (C.G.) ……Ĥ×यथȸ / Respondent Assessee by : Shri Rakesh Dhody, CA Revenue by : Dr. Priyanka Patel, Sr. DR सुनवाई कȧ तारȣख / Date of Hearing : 06.02.2026 घोषणा कȧ तारȣख / Date of Pronouncement : 11.02.2026 Printed from counselvise.com 2 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 आदेश / ORDER PER PARTHA SARATHI CHAUDHURY, JM: The present appeal preferred by the assessee emanates from the order of the Ld.CIT(Appeals)/NFAC, dated 28.05.2025 for the assessment year 2017-18 as per the following grounds of appeal: “1. That the Ld. Commissioner of Income Tax (Appeals) has erred in sustaining the addition of Rs.55,24,000/- made by the Ld. Assessing Officer. 2. The Ld. Commissioner of Income Tax (Appeals) is not justified in confirming action of the Ld. Assessing Officer in applying section 69A on the cash deposited of Rs.55,24,000/- and charging the same to higher rate of tax under section 115BBE of the Act. 3. The appellant reserves the right to addition, alter or omit all or any of the grounds of appeal in the interest of justice.” 2. Brief facts in this case are that this is a case where the wife (assessee) and her husband is having a joint account in the bank. During relevant year, there was cash deposits made in the said bank account which was added by the department u/s. 69A of the Income Tax Act, 1961 (for short ‘the Act’) as unexplained money in the hands of the assessee. But the fact of the matter is that as explained by the assessee before the Department that such money deposited was by her husband in the joint account belonging jointly of the assessee and her husband. The Revenue authorities had made the addition without cross examination of husband of the assessee nor had enquired in the genuineness of the statements and Printed from counselvise.com 3 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 written submissions filed by the assessee and the Ld. CIT(Appeals)/NFAC had not passed the order in terms with Section 250(4) & (6) of the Act. 3. The only ground, on which, the addition was made was that husband returned income appears low in revenue vis-à-vis deposits made, and the assessee contended that solely on the basis of the returned income, the entire addition made is unjustified. 4. The Ld. Sr. DR supported the findings of the sub-ordinate authorities. 5. The Ld. Counsel for the assessee has submitted written submissions which is extracted as follows: Printed from counselvise.com 4 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 Printed from counselvise.com 5 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 Printed from counselvise.com 6 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 Printed from counselvise.com 7 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 Printed from counselvise.com 8 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 Printed from counselvise.com 9 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 Printed from counselvise.com 10 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 Printed from counselvise.com 11 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 6. We have heard the rival submissions, considered the documents/evidence on record and analyzed the facts and circumstances in this case. There was scrutiny assessment based on the information that the assessee had deposited cash amounting to Rs.19,35,000/- in her bank account during demonetization period and the initial assessment order u/s. 143(3) of the Act was passed on 16.12.2019 with an addition of Rs.19,35,000/- as unexplained money u/s. 69A of the Act. Thereafter, order u/s. 263 of the Act was passed wherein the Pr. CIT held that the A.O had added only Rs.19,35,000/- i.e. the cash deposits during demonetization period instead of entire amount of cash deposits during F.Y.2016-17 i.e. Rs.52,24,000/-. The case was set-aside for denovo assessment and during such consequential assessment proceedings, the Printed from counselvise.com 12 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 assessee submitted a declaration by her husband that he deposited cash of Rs.19,45,000/- in their joint account during demonetization period. The assessee also submitted a letter by her husband Shri Dhiren Yugal Kishore stating that the cash deposits in the joint account have been made by him and the source of the same was cash received by him during the course of business activities and also from his past year savings. However, the A.O observed from ITRs of A.Y.2016-17, 2017-18 and A.Y.2018-19 of her husband that the returned income is not matching with the amount deposited and therefore, in the consequential order passed u/s. 143(3) r.w.s. 263 of the Act, the addition of Rs.52,24,000/- u/s. 69A of the Act was made in the hands of the assessee. 7. That being aggrieved with such assessment order, the assessee preferred an appeal before the Ld. CIT(Appeals)/NFAC. That before the said authority also, the assessee reiterated that it was a joint account and the money therein belongs to the assessee as well as her husband and the source of such cash deposits made by the husband of the assesse was from his regular course of business activities and also from his past savings. The Ld. CIT(Appeals)/NFAC summarily brushed aside the submissions of the assessee and dismissed the appeal. 8. We find that the Revenue has neither disputed that the account is joint account nor has disputed the source of income of the assessee as well Printed from counselvise.com 13 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 as her husband. The Department has also not unearthed any other undisclosed sources of income of the assessee as well as her husband. It has been explained through declaration by her husband as well as letter from the assessee that the cash deposits made during the demonetization period was by husband of the assessee in the joint account. Further, the Revenue did not provide any opportunity for cross examination of the husband of the assessee and the first appellate authority has also not conducted any independent inquiry so to come to a rational conclusion. It is important for quasi-judicial authority to consider all the documents placed on record before arriving at a particular decision and if the relevant documents that has been furnished by the tax payer assessee before such quasi-judicial authority has been summarily brushed aside and not considered, such action of the said authority becomes perverse, arbitrary and bad in law. It was more important for the Revenue to comply with the principles of natural justice in more particular “audi-alterm partem” i.e. right to be heard and once the declaration was given by her husband, it was incumbent upon the Ld.CIT(Appeals)/NFAC to conduct necessary inquiry to ascertain the genuineness of the claim raised by the assessee and to cross examine the claim raised by husband of the assessee. That in absence of any such inquiry and simply dismissing the appeal of the assessee summarily is not validated within the purview of Income Tax legislation. Printed from counselvise.com 14 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 9. At this stage, we deem it fit to extract the said relevant declaration submitted by husband of the assessee before the Department a/w. letter of the assessee which reads as follows: Printed from counselvise.com 15 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 10. In the aforesaid letter, it has been disclosed by the husband of the assessee that he is regular tax payer and that he has given the entire Printed from counselvise.com 16 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 break up of the deposits of Rs.19,45,000/- in the said bank account. He has further declared that he had deposited cash in joint account held in the name of his wife and himself from the cash that was received by him during the course of his business activities and past years savings and that his wife is a school teacher and she has no idea in relation to the cash deposits made in the joint account. It is a matter of practical parlance that in order to use money for running household, both wife and husband opens a joint account in the bank for various practical purposes and for ease of overcoming day to day financial requirements. The money deposited in such account belongs to both the account holders and when statement/submissions were made before the Department regarding genuineness of a particular deposits without examination of such contents therein, it was not appropriate for the Department to fasten liability u/s.69A of the Act in the hands of one account holder when facts are that such deposits were made by the other account holder. The source and nature of such cash deposits when has been clearly explained the addition u/s. 69A of the Act as unexplained money is thereby unjustified and misplaced, bad in law. 11. We further take guidance from the judgment of the Hon’ble Supreme Court in the case of Mehta Parikh & Co. Vs. CIT (1956) 30 ITR 181 (SC), wherein, it had been held that uncontroverted affidavit should not be ignored and the contents thereof must be considered as true and Printed from counselvise.com 17 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 correct. The same was also followed by the Co-ordinate Bench of the Tribunal, Delhi in the case of Sudarsan De Vs. DCIT, Circle-2(2)(1), ITA No.5176/Del/2024, A.Y.2015-16, dated 20.08.2025. We also observe that the Revenue has failed to bring on record any contrary material disbelieving the contents of the declaration filed by husband of the assessee before the Department. There is no contrary material to suggest that money deposited was not of the husband of the assessee who was also a joint holder of the account. Further, neither the A.O nor the Ld.CIT(Appeals)/NFAC has provided any concrete reasoning to reject the submission/declaration filed by the assessee and her husband. Mere suspicion and conjecture is not sufficient to sustain the addition u/s. 69A of the Act. 12. We, therefore, set-aside the order of the Ld. CIT(Appeals)/NFAC and direct the A.O to delete the entire addition made u/s.69A r.w.s 115BBE of the Act from the hands of the assessee while giving appeal effect of this order. We order accordingly. 13. As per the above terms grounds of appeal raised by the assessee are allowed. Printed from counselvise.com 18 Trupti Shukla Vs. ITO-1, Rajnandgaon ITA No. 461/RPR/2025 14. In the result, appeal of the assessee is allowed. Order pronounced in the open court on 11th February, 2026. Sd/- Sd/- AVDHESH KUMAR MISHRA PARTHA SARATHI CHAUDHURY (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) रायपुर/ RAIPUR ; Ǒदनांक / Dated : 11th February, 2026. SB, Sr. PS आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of the Order forwarded to : 1. अपीलाथȸ /The Appellant. 2. Ĥ×यथȸ /The Respondent. 3. The CIT(Appeals)-1, Raipur (C.G.) 4. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय अͬधकरण, रायपुर बɅच, रायपुर / DR, ITAT, Raipur Bench, Raipur. 5. गाड[ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलȣय अͬधकरण, रायपुर / ITAT, Raipur. Printed from counselvise.com "