Tribunal removes Rs.10,00,000 income addition; cash belonged to another party

The Tribunal allowed the appeal by the assessee, directing the deletion of the Rs.10,00,000 addition made to the assessee's income under section 69A r/w section 115BBE of the Income Tax Act, 1961 for the assessment year 2018-19. The Tribunal found that the cash amount in question belonged to Mangesh D. Gaikar, not the assessee, based on evidence including statements and submissions, leading to the removal of the disputed addition.

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Issues:
Challenge to order passed under section 250 of the Income Tax Act, 1961 for the assessment year 2018-19.

Analysis:
1. The assessee contested the order passed by the Commissioner of Income Tax (Appeals) under section 250 of the Income Tax Act, 1961. The grounds of appeal included challenges to the assessment made by the Assessing Officer under section 143(3) of the Act, specifically regarding the addition of Rs.10,00,000 under section 69A r/w section 115BBE.

2. The brief facts of the case revealed that the assessee, engaged in property brokerage and commission business, was involved in a search and seizure action conducted in connection with Umesh D. Tanna and Mangesh D. Gaikar group. The Assessing Officer added Rs.10 lakh to the assessee's income as unexplained income due to a cash transaction on 23/10/2017. The CIT(A) upheld this addition, questioning the source of the cash and rejecting explanations provided by the parties involved.

3. During the appeal, the assessee argued that the amount in question did not belong to him but was handed over to Mangesh D. Gaikar on behalf of his father. The AR highlighted statements and submissions supporting this claim. In contrast, the DR emphasized the lack of entries in the father's cash book and the absence of concrete evidence regarding the ownership of the cash amount.

4. The Tribunal examined the evidence, including documents seized during the search, statements of the parties involved, and submissions made during assessment proceedings. It noted that both the father of the assessee and Mangesh D. Gaikar acknowledged that the cash paid by the assessee belonged to the latter. Additionally, Mangesh D. Gaikar was taxed for unaccounted income related to the same cash transaction. Given these findings, the Tribunal concluded that the addition in the hands of the assessee was unwarranted, directing the deletion of the added amount.

5. Consequently, the Tribunal allowed the appeal by the assessee, setting aside the impugned addition and directing the Assessing Officer to remove the Rs.10,00,000 addition from the assessee's income.

This detailed analysis of the judgment highlights the issues raised, the facts of the case, arguments presented, and the Tribunal's decision based on the evidence and legal provisions involved.

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