2022 (10) TMI 299 - HC - Income Tax

Court affirms authority's decision on tax returns & search document request. Petitioner's explanations deemed incriminating.

B. Ramamoorthy Versus The Assessment Officer Ward 3, Vellore, Deputy Commissioner of Income Tax

The court upheld the authority's procedure and conclusions in a case involving a petitioner who failed to file income tax returns, requested documents ... Reopening of assessment u/s 147 - unexplained cash deposits - HELD THAT:- As till 21.12.2019, absolutely no submissions have been made on the merits of the matter and the petitioner has been only reiterating his request for documents. For the first time on 27.12.2019, even without filing a return of income pursuant to search conducted in his premises on 22.02.2019, 23.02.2019 and 24.02.2019, he puts forth an explanation for that substantial cash deposits that have been made in the savings bank account, stating that such deposits relate to transaction in connection with the property situated at Vellore Bus stand. Both the replies of the petitioner dated 24.10.2019 and 27.12.2019 are especially incriminating insofar as they refer to the involvement of heavy cash transactions in respect of the vellore property. Incidentally, a vague statement is made that the cash deposits were in the course of usual business transaction. In the absence of any return of income filed by the petitioner, such a statement cannot be countenanced or accepted. Thus, there is absolutely no infirmity in the impugned assessment order, neither in terms of the procedure followed by the authority nor in the conclusion that have been arrived at. WP dismissed. Issues:1. Non-filing of income tax return by the petitioner.2. Requests for documents and statements related to the search conducted.3. Explanation provided for substantial cash deposits in the bank account.4. Assessment order validity and conclusion.Analysis:1. The petitioner, a non-filer, did not submit any income tax return, either initially or in response to notices under Section 148 of the Income Tax Act, 1961.2. The petitioner requested copies of statements recorded during a search conducted at another individual's premises. The petitioner also sought a copy of their Savings Bank account statement, which was provided by the bank.3. The petitioner explained substantial cash deposits in their bank account as related to transactions concerning a property at Vellore Bus stand. However, the explanation was deemed insufficient due to the absence of an income tax return filing.4. The court found no fault in the assessment order, stating that the petitioner's responses were incriminating, especially regarding heavy cash transactions for the Vellore property. The court upheld the authority's procedure and conclusions, leading to the dismissal of the Writ Petition and the connected Miscellaneous Petition without any costs.