AI Drafter 
TaxTMI 
TaxTMI 
2024 (12) TMI 111
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.... as well as law on the subject, the learned CIT(A) has erred in confirming the action of learned assessing officer has erred in making addition of Rs. 43,99,215/- u/s 69A of the I.T. Act on account of alleged unexplained money being cash deposits in bank accounts. 3. On the facts and circumstances of the case as well as law on the subject, the learned assessing officer has erred in making addition of Rs. 1,70,507/- u/s 69 of the I.T. Act on account of alleged unexplained investment being other credits in the bank accounts. 4. It is therefore prayed that the assessment framed may please be quashed and/or the above addition made by the assessing officer may please be deleted. 5. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal." 2. The assessee vide application dated 18/10/2024 raised following additional ground of appeal: "On the basis of facts and circumstances of the case as well as law on the subject, the ld. CIT(A) has erred in not condoning the delay in filing appeal before ld. CIT(A)" 3. Brief facts of the case are that no return of income for assessment year 2012- 13 ....
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....t cash deposit in bank account represented unaccounted income. Reasons recorded is to be examined as a standalone basis. It must be something which indicate that income has escaped from assessment. Mere bank deposit does not constitute undisclosed income and indicate that this deposit constitutes an income which escape assessment. To support such view, assessee relied upon decision of Delhi Tribunal in the case of Bir Bahadur Singh Sijwali Vs ITO 53 taxmann.com 366 (Del-Trib.) and other decisions. On merit, assessee stated that he was engaged in business of taking cash from various parties and issuing discounting cheque on commission basis and assessee was charging @ 1.00 % commission on the transaction. Thus, net result of profit was Rs. 45,697/-, which was below taxable limit. Hence, no return of income was filed by assessee. In alternative submission, assessee submitted that similar kind of business, commission ranging from 0.10% to 1.00% is earned, hence, addition of total income may be restricted by estimating profit @ 1.00 % of the transaction. To support such view, assessee relied upon the decision of ITAT Ahmedabad Benches in the case of Sanjay R Shah vs. ITO [2017] 88 taxm....
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....DT), provided it was genuine delay and was out of control on taxpayer. 8. The Ld. CIT(A) also considered the grounds of appeal on merit and held that ratio of decisions of various case laws are not identical to the case of assessee. Some cases, seems to be in favour of assessee but amount involved therein are very meagre and many cases, the facts are not similar with the facts of the instant case. The assessee has not intentionally adhered to various notices issued by Assessing Officer which resulted into passing assessment order under section 144 of the Act. The assessee has not filed any return of income in response to notice issued under section 148 of the Act. He never asked for reasons recorded. Thus, there is no infirmity in the reopening proceedings. The assessee failed to produce any material for challenging the reopening. On merit of addition, ld. CIT(A) upheld the additions by referring the decisions of Bengaluru Tribunal in Ashok Kumar Jai vs. ACIT in ITA Nos. 329-331/Bang/2011, wherein it was held that when the assessee has not given details of beneficiary to whom assessee has provided business of cheque discounting, the business remained unexplained, thus, the ld. C....
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....ped from assessment as has been held in Birbahadur Singh Sijwali Vs ITO in 53 taxmann.com 366 (Delhi Trib). The basic requirement for reopening is that Assessing Officer must apply his mind to the material in order to have a reason to believe that income has escaped from assessment. 11. In support of ground No. 2 and 3, which relates to addition of cash deposit and other credit in the bank account, the Ld.AR for the assessee submits that mere cash deposit cannot be considered as income. The Assessing Officer made reopening solely on the basis of report of ITR information. Making any independent investigation of fact, there is no liking nowhere reasons recorded on the alleged escapement of income. The cash deposit in bank per se cannot be considered as books of account nor it can be sole category for determining the income of assessee. Ld. AR for the assessee submits that assessee was in the business of cheque discounting, the assessee was receiving cash from his customers and used to issue cheque. The Ld. AR for the assessee submits that business of textile and other readymade garments in Surat businessmen do not take a risk for carrying cash with them. The assessee used to coll....
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....O [2017] 88 taxmann.com 809 (Ahmedabad-Trib.) * ITO vs. Deepak Vithaldas Suchank ITA No.361/Srt/2018 dated 30.07.2021 * Nanak Motumal Pherwani vs. ITO ITA No.527/Srt/2024 dated 14.10.2024 * CIT vs. Tirupati Construction Co. [2015] 55 taxmann.com 308 (Guj) * PVIT vs. Shri Indrajeet Zandusing Tomar TA No.908 of 2015 dated 22.12.2015 * Smt. Manjuilaben Champaklal vs. ITO ITA No.1155/Ahd/2011 dated 02.05.2014 * Shri Babubhai Ganpatram Painter vs. ITO ITA No.1363/Ahd/2015 dated 28.02.2019 * ITO vs. Maheshkumar Jayantilal Vora (2004) 23 CCH 0083 Rajkot Trib 12. On the other hand, Ld. Sr-DR for the Revenue submits that before Assessing Officer assessee has not made any compliance despite giving numerous opportunities. Thus, Assessing Officer has no option but to complete assessment under section 144 of the Act. On the plea raised in additional ground of appeal, the ld. Sr. DR for the revenue submits that appeal before ld CIT(A) was filed beyond the prescribed period of limitation, no application for condonation of delay was filed by the assessee. Still, the Bench may take decision in accordance with its discretion. Against ....
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....the fact that delay in filing appeal before Ld. CIT(A) was only of 50 days. I further find the delay was not very long or inordinate. The assessee was not going to be benefitted by filing appeal belatedly. Thus, considering overall facts and circumstances of the case, the order of Ld. CIT(A) on the issue of delay is set aside. In the result, additional ground of appeal is allowed. Now adverting to merit of the case. 14. Ground No 1. relates to validity of reopening and issuing notice under section 148 of the Act. I find that Assessing Officer made reopening on the basis of AIR information about huge cash deposits in assessee's bank accounts and notice under section 148 was served on 23.03.2019. Service of notice under section 148 is nowhere disputed by Ld. AR for the assessee, in her submission or in the submission filed before Ld. CIT(A). Admittedly, neither return of income was filed in response to notice under section 148 of the Act nor any objection is raised before Assessing Officer. Though, ground of appeal on the validity or reopening was raised before ld CIT(A), however, main contention of the assessee was that reasons recorded and details of the AIR information was not ....
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.... (1999) 236 ITR 34 (SC) held that sufficiency or correctness of the material was not a thing to be considered at the stage of reopening. I find that Assessing Officer has sufficient tangible material in the form of information about cash credit in the bank account of assessee and that assessee has not filed return of income for relevant assessment year. Thus, at the time of reopening, prima facie, there was a sufficient tangible material for reopening of the case. Thus, I do not find any merit in the ground of appeal corresponding raised by assessee. Ground No.1 of assessee is dismissed. 15. Ground No.2 and 3 relate to addition on account of unexplained money under section 69A and unexplained investment under section 69 of the Act on account of bank accounts as recorded above, that case of assessee was reopened on the basis of AIR information that assessee deposited huge cash in his bank accounts, since no return of income was filed by assessee either under section 139 or in response to 148 of the Act. The Assessing Officer obtained information from banker of assessee about various credit in the bank accounts maintained by assessee. The banker of the assessee informed to Assessi....