VIJAYALAKSHMI VALATHURU,TADEPALLI V. COMMISSIONER OF INCOME TAX (APPEALS), FACELESS ASSESSMENT

ITA 207/VIZ/2024

AI Insights

The case involves Vijayalakshmi Valathuru, who appealed against the order of the Learned Commissioner of Income Tax (Appeals) at the National Faceless Appeal Centre, Delhi, which upheld the Assessing Officer's decision treating her cash deposits as unexplained money under section 69A of the Income Tax Act, 1961. The primary contention was the addition of Rs. 14,34,500 to her income for the Assessment Year 2017-18, which she argued were legitimate deposits from her spouse's withdrawals. The Tribunal examined the timelines and the explanations provided, ultimately finding in favor of the assessee.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 315486 (ITAT-VISAKHAPATNAM)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Income from undisclosed sources
• Section: 143(3); 154

Judgement Text

" आयकर अपीलीय अधिकरण, धिशाखापटणम पीठ, धिशाखापटणम IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM “SMC” BENCH, VISAKHAPATNAM श्री िीरिल्ली दुर्ाा राि,न्याधयक सदस्य एिं श्री एस बालाक ृष्णन, लेखा सदस्य क े समक्ष BEFORE SHRI VEERAVALLI DURGA RAO, HON’BLE JUDICIAL MEMBER & SHRI S BALAKRISHNAN, HON’BLE ACCOUNTANT MEMBER आयकर अपीलसं./I.T.A.No.207/VIZ/2024 (निर्धारणवर्ा/ Assessment Year: 2017-18) Vijayalakshmi Valathuru 12-465/2/1/B 402 Pine Woods B-Block Asramam Road, Near Our Place Restaurant Tadepalle, Guntur – 522501 Andhra Pradesh [PAN: ACVPV1885D] v. ITO-Ward – 1(3) Income Tax Department Vijayawada Andhra Pradesh (अपीलार्थी/ Appellant) (प्रत्यर्थी/ Respondent) करदाता का प्रतततितित्व/ Assessee Represented by : Shri Chundru Sudheer राजस्व का प्रतततितित्व/ Department Represented by : Dr. Aparna Villuri, Sr.AR सुिवाई समाप्त होिे की ततति/ Date of Conclusion of Hearing : 09.04.2025 घोर्णध की तधरीख/Date of Pronouncement : 13.05.2025 आदेश /O R D E R PER SHRI VEERAVALLI DURGA RAO, JUDICIAL MEMBER: 1. This appeal is filed by the assessee against revenue order of Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [hereinafter in short “Ld. CIT(A)”] vide DIN & Order No: I.T.A.No.207/VIZ/2024 Vijayalakshmi Valathuru Page No. 2 ITBA/NFAC/S/250/2023-24/1060431275(1) dated 02.02.2024 for the A.Y.2017-18 arising out of order passed under section 143(3) of Income Tax Act, 1961 [hereinafter in short “the Act”] dated 09.12.2019. 2. At the outset, we observe from the appeal record that there is a delay of 29 days in filing the appeal before us. On perusal of the affidavit filed by the Ld.AR and Medical certificate filed along with the petition for condonation of delay, we are of the opinion that the assessee has reasonable and sufficient cause for the delay in filing the appeal before us. Accordingly, we condone the delay and proceed to dispose of the case on merits. 3. Briefly stated facts of the case are, assessee is an individual filed her return of income on 26.07.2017 admitting a total income of Rs. 12,78,740/- for the A.Y. 2017-18. Subsequently, the case was selected for scrutiny through CASS. The Ld. Assessing Officer (hereinafter in short “Ld. AO\") issued a notice under section 143(2) of the Act. Assessee from time to time submitted the explanations and evidences in support of cash deposits made during the year. Considering the explanations of the assessee, Ld. AO completed the assessment under section 143(3) of the Act on 09.12.2019 by treating the entire cash deposits of Rs. 14,34,500/- as unexplained money under section 69A of the Act by raising demand of Rs. 58,91,010/-. The demand was revised under section 154 of the Act, and the Ld. AO reduced the demand to Rs. 14,75,575/- vide order dated 16.12.2019. I.T.A.No.207/VIZ/2024 Vijayalakshmi Valathuru Page No. 3 4. On being aggrieved by the order of the Ld. AO, assessee filed an appeal before Ld. CIT(A). Assessee made similar submissions before the Ld.CIT(A). Ld. CIT(A) after examining the same found the claim of the assessee is not tenable and thereby upheld the order of the Ld. AO while dismissing the appeal of the assessee. 5. On being aggrieved by the order of the Ld. CIT(A), assessee is in appeal before us by raising following grounds in its appeal: - “1. Time gap between withdrawal of cash and its further deposit to the Bank account, cannot be treated as Income from undisclosed sources 2. There is no bar to hold cash by the assessee in any quantum. 3. Amount withdrawn from Spouse Bank account is deposited in Assessee's Bank account cannot be treated as Unexplained Money u/s 69A of Income tax act 4. When Assessing officer does not have discrepancies on Source of Income, treating the Deposits as Unexplained Money Just because of Time lag is unjust and contrary to the Provisions of Law.” 6. The only issue contested by the assessee is with respect to the addition of Rs. 14.34.500/- being the cash deposits made by the assessee into the bank account. Ld. AR argued that source for the cash deposits were out of withdrawals made from the spouse account as detailed below: - S.No. Date of Withdrawal made by spouse Amount withdrawn (1) (2) (3) 1. 25.05.2015 Rs.5,80,000 2. 30.06.2015 Rs.24,00,000 I.T.A.No.207/VIZ/2024 Vijayalakshmi Valathuru Page No. 4 S.No. Date of Withdrawal made by spouse Amount withdrawn (1) (2) (3) 3. 17.07.2015 Rs.2,00,000 4. 13.08.2015 Rs.4,40,000 Total Withdrawal by Spouse Rs.36,20,000 7. Ld.AR further submitted hat assessee was holding the cash and later during the year 2016-2017 deposited the same into the assessee’s bank account as detailed below: - S.No. Date of Deposit Amount Deposited in Rs. 1. 11.04.2016 10,000 2. 25.04.2016 15,000 3. 16.05.2016 20,000 4. 07.06.2016 8,50,000 5. 09.06.2016 4,75,000 6. 25.07.2016 20,000 7. 26.09.2016 10,000 8. 18.10.2016 10,000 9. 31.10.2016 5,000 10. 23.01.2017 3,000 11. 31.01.2017 16,500 Total 14,34,500 8. Ld.AR argued that, Ld. AO has not considered the cash withdrawals as the source for cash deposits because of time lag of one year between the date of withdrawals and date of deposits. He therefore pleated that the onus of proving the source has been established whereas the Ld. AO has merely not accepted the claim of the assessee based on assumption and surmises. He therefore prayed to delete the addition made by the Ld. AO. I.T.A.No.207/VIZ/2024 Vijayalakshmi Valathuru Page No. 5 9. Per contra, Ld. Departmental Representative (hereinafter in short “Ld.DR) heavily relied on the orders of the Revenue Authorities. 10. We have heard both the sides and perused the material available on record. It is an admitted fact that the assessee has made the cash withdrawals from the account of Shri K. Sankar (spouse of assessee), as below: - S.No. Date of Withdrawal made by spouse Amount withdrawn 1. 25.05.2015 Rs.5,80,000 2. 30.06.2015 Rs.24,00,000 3. 17.07.2015 Rs.2,00,000 4. 13.08.2015 Rs.4,40,000 Total Withdrawal Rs.36,20,000 11. Assessee stated that these cash were held by her and deposited into her bank account as follows: S.No. Date of Deposit Amount Deposited in Rs. 1. 11.04.2016 10,000 2. 25.04.2016 15,000 3. 16.05.2016 20,000 4. 07.06.2016 8,50,000 5. 09.06.2016 4,75,000 6. 25.07.2016 20,000 7. 26.09.2016 10,000 8. 18.10.2016 10,000 9. 31.10.2016 5,000 10. 23.01.2017 3,000 11. 31.01.2017 16,500 Total 14,34,500 I.T.A.No.207/VIZ/2024 Vijayalakshmi Valathuru Page No. 6 12. The assessee has established the source of cash deposits before the Ld.AO. However, Ld. AO had not made any enquiries but has not accepted the submissions of the assessee on the basis that there was a time lag of one year between the withdrawals and the deposits. Ld. AO further observed that assessee has not furnished any reasons for keeping such huge amount as cash in hand. However, in our considered view there is no bar in holding the cash after withdrawals for the longer period before being deposited into bank on subsequent dates. Ld. AO has neither brought any material on record to prove that the cash withdrawn by the assessee during the year 2015 was utilized for some other purpose other than making the deposits into the spouse account. In the absence of any material evidence that the cash has been expended it can be concluded that assessee held the cash for a longer period of time before depositing the same into the bank account during the year 2016-2017. We therefore direct the Ld. AO to delete the addition of Rs.14,34,500/- since the assessee has proved the sources of cash deposits into the bank account. Thus, Grounds raised by the assessee are allowed. 13. In the result, appeal of the assessee is allowed. Order pronounced in the open court on 13th May, 2025. Sd/- (एस बालाक ृष्णन) (S. BALAKRISHNAN) लेखा सदस्य/ACCOUNTANT MEMBER Sd/- (श्री िीरिल्ली दुर्ााराि) (VEERAVALLI DURGA RAO) न्याधयक सदस्य/JUDICIAL MEMBER Dated: 13.05.2025 Giridhar, Sr.PS I.T.A.No.207/VIZ/2024 Vijayalakshmi Valathuru Page No. 7 आदेशकीप्रनतनलनपअग्रेनर्त/ Copy of the order forwarded to :- 1. निर्धाररती/ The Assessee : Vijayalakshmi Valathuru 12-465/2/1/B 402 Pine Woods B-Block Asramam Road, Near Our Place Restaurant Tadepalle, Guntur – 522501 Andhra Pradesh 2. रधजस्व/ The Revenue : ITO-Ward – 1(3) Income Tax Department Vijayawada Andhra Pradesh 3. The Principal Commissioner of Income Tax 4. नवभधगीयप्रनतनिनर्, आयकरअपीलीयअनर्करण, नवशधखधपटणम /DR,ITAT, Visakhapatnam 5. The Commissioner of Income Tax 6. गधर्ाफ़धईल / Guard file //True Copy// आदेशधिुसधर / BY ORDER Sr. Private Secretary ITAT, Visakhapatnam "