TaxTMI 
TaxTMI 
2025 (1) TMI 1118
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....hich reads as under: "1. Assessment order passed by the ITO-4(1), Raipur is illegal inasmuch as the same has been passed by non-jurisdictional A.O, Assessment order is liable to be quashed. 2. Assessment order passed by the ITO-4(1), Raipur is illegal inasmuch as no order u/s.127 was passed for transfer of case from ITO-3(1), Raipur to ITO-4(1), Raipur. Assessment order is liable to be quashed." As the assessee based on the additional grounds of appeal has assailed the validity of the jurisdiction that was assumed by the A.O for framing the impugned assessment, adjudication of which would not require looking any further beyond the facts available on record, therefore, I have no hesitation in admitting the same. My aforesaid view that where an assessee, had raised, though for the first time, an additional ground of appeal before the Tribunal which involves purely a question of law and requires no further verification of facts, then, the same merits admission finds support from the judgment of the Hon'ble Supreme Court in the case of National Thermal Power Company Ltd. Ltd. Vs. CIT (1998) 229 ITR 383 (SC). 2. Succinctly stated, the assessee had e-filed her ret....
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.... on 30.01.2018. The case was selected for scrutiny through CASS, the reason being large value cash deposit during demonetization period. So, notice u/s 143(2) of the Income tax Act, 1961 was issued by the AO on 09/08/2018 and served upon the assessee. Notice u/s 142(1) of the Income tax Act, 1961 along with questionnaire was issued and served upon the assessee on 09.08.2019. The assessee responded to the queries raised from time to time, by way of written submissions and other relevant documents electronically, in which the assessee stated that the source of cash deposit is out of accumulated capital & income from hobby classes and also from bank withdrawals. 8.1 The assessee derives income from other source in the form of interest income and Hobby Classes, during the year under consideration and earlier years also. During the year the assessee has deposited a sum of Rs. 11,00,000/- in Allahabad Bank, Raipur bearing A/c No. 20036033060. In order to verify genuineness of business of the assessee, Inspector of AO's office was deputed to make field enquiry about business activity of the assessee. On verification, it was found that no such activity was being carried out fr....
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....ection 69A-Unexplained Money "Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money. bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the 4 Assessing] Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year.]" 8.5 In the present case, the assessee had deposited Cash amounting to Rs. 11,00,000/- in her bank account(s), which has been treated as unexplained money. An assessee is found to be the owner of the Money appearing in his/her bank accounts. Though the assessee was found owner of the Money but has not offered any acceptable and cogent explanation regarding the source of such Money found in his/her bank accounts, the same is unexplained income of the Assessee u/s 69A of the Act. ....
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.... case of Chuharmal Vs CIT (1988) 172 ITR 250 while affirming the view of the Madhya Pradesh High Court has held that 'the expression 'INCOME as used in Section 69A of the Act, 1961 had a wide meaning which meant anything which came in or resulted in gain and on this basis, concluded that the assessee had Income which he had invested in purchasing article and he could be held to be owner and the value could be deemed to be his income by virtue of Section 69A of the Act. Following the ratio of the judgement of Hon'ble Supreme Court, in the instant case, the assessee deposited Cash in her bank account and on the basis can be concluded that the assessee had income to the extent of cash deposit made during the year under consideration appearing in bank accounts and she would be held to be the owner and the Money at her credit could be deemed to be her income by virtue of Section 69A of the Act. Hence, in the facts of this case a legitimate inference can be drawn that the assessee had income which she had deposited in Bank accounts and, as such, that Income was subject to tax. 8.5.4 Further, the Hon'ble Supreme Court in the case of Smt Srilekha Banerjee ....
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....eld in the case of Smt. Srilekha Banerjee and others (cited supra) that 'the Department was justified in holding that Rs. 51,000/- was assessable income of the assessee from some undisclosed source. It was not correct that the assessee was not required to prove anything and that the burden was entirely upon the department to prove that the amount received from the encashment of high denomination notes was income. The correct position is as follows. If there is an entry which shows the receipt of a sum or conversion of the notes by the assessee by himself, it is necessary for the assessee to establish, if asked, what the source of that money was and to prove that it did not bear the nature of income. The department is not at this stage required to prove anything. The fact that there was receipt of money or conversion of notes is itself prima facie evidence against the assessee on which the Department can proceed in absence of good explanation." 8.5.5 Therefore, in case where assessee's huge cash deposits in her bank account(s) during the year under consideration, but the sources were neither explained nor such money offered for taxation, the onus is on the assessee ....
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....as under.- "Section 69A, read with section 115BBE, of the Income tax Act, 1961 Unexplained moneys (cash deposit) - Assessment year 2017-18 - Assessee was engaged in business of retail/wholesale of egg - during demonetization period, assessee made cash deposit in his bank accounts and claimed that same was out of sale proceeds from wholesale/trading of egg business - Assessing Officer noted that assessee had deposited specified bank notes in his bank account - He, thus, treated same as unexplained money under section 69A and taxed same under section 115BBE on ground that assessee's business did not come under exempted category and assessee was not allowed to received old SBN notes as same ceased to be legal tender - Whether since Central Government had notified that denomination of Rs. 1000 and Rs. 500 notes was not a legal tender with effect from 9-11-2016, nobody could engage in trading through this currency- Held, yes - Whether thus, Assessing Officer had rightly added cash deposits made by assessee under section 69A - Held, yes [Para 4] [in favour of revenue] 8.6.2 Reliance is further placed on the decision of the Hon'ble ITAT, Raipur Bench in the case of A....
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....nt reason backed by sufficient evidence, the explanation of the assessee is only a make-believe story and hence cannot be accepted. The decisions relied upon by the learned AR will also be of no help to the assessee as in the present case the assessee has failed to prove the source of deposit with valid reasons and proper evidence. In this view of the matter, we do not find any infirmity in the order of the CIT (A) in sustaining the addition of Rs. 6,50,000/-. Accordingly, we uphold the order of the CIT (A) by dismissing the ground raised by the assessee. 15. In the result, the appeal by the assessee is hereby dismissed." 8.6.4 It is also relevant to refer to the Decision of Hon'ble ITAT Bangalore in the case of Karan Sharma v. ITO in ITA No. 465/Bang/2018 wherein it is held as under: "6. The assessee has explained that Rs. 92.64,462 is out of previous withdrawals and sale of garments and pleaded that it is to be excluded from the taxation. The assessee has not furnished any evidence to establish the nexus between the earlier withdrawals and deposits into various bank accounts. In such circumstances, we are not in agreement with the assessee's cou....
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....aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before the Tribunal. 6. I have heard the Ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record, as well as considered the judicial pronouncements that have been pressed into service by the Ld. AR to drive home his contentions. 7. Shri R.B Doshi, Ld. Authorized Representative (for short 'AR') for the assessee, at the threshold, submitted that both the lower authorities had grossly erred in law and facts of the case in making/sustaining the addition u/s. 69A of the Act. It was submitted by the Ld. AR that though the assessee had before the A.O duly explained the source of the subject cash deposits, viz. (i) out of her accumulated capital; (ii) current years income from the vocation of running hobby classes; and (iii) bank withdrawals, but the latter had most arbitrarily not considered the same. The Ld. AR submitted that now when the cash deposits of Rs. 11 lacs (supra) were made by the assessee from her duly explained sources, therefore, there was no justification for the A.O to have treated any part of the same as her unex....
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.....3/2017, dated 21.02.2017 for estimating the amount of cash in hand that would have been available with her to source the subject cash deposits in her bank account. For the sake of clarity, the CBDT Instruction No.03/2017 dated 21.02.2017 is culled out as under (relevant extract): "1.1 In case of an individual (either than minors) not having any business income, no further verification required to be made if total cash deposit is up to Rs. 2.5 lakh. In case of taxpayers above 70 years age, the limit is Rs. 5 lakh per person. The source of such amount can be either household savings/ savings from past income or amounts claimed to have been received from any of the sources mentioned in Paras 2 to 6 below. Amounts above this cut-off may require verification to ascertain whether the same is explained or not. The basis for verification can be income earned during past years and its source, filing of ROI and income shown therein, cash withdrawals made from accounts etc." (emphasis supplied by me) 12. As the assessee had been filing her returns of income, therefore, I am of a firm conviction that in the backdrop of the aforesaid CBDT Instruction No.03/2017 (supra), it can s....
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....6. Shiv Shankar Agrawal AEYPA9273R 2017-18 ITO-3(1), ITO-4(5), Raipur Raipur 7. Tamanna Khanna CYIPK5350F 2017-18 ITO-3(1), ITO-4(5), Raipur Raipur 8. Avinash Sherwani CWFPS5579B 2017-18 ITO-3(1), ITO-4(5), Raipur Raipur 9. Shashikala Pathar AYIPP3941K 2017-18 ITO-3(1), ITO-4(4), Raipur Raipur 10. Taranagraj AKGPN9168G 2017-18 ITO-3(1), ITO-4(4), Raipur Raipur 11. Ayallasomayajula AKGPM9416Q 2017-18 ITO,3(1), ITO-4(4), 12. Venkat Laxmi Sanjay Rathi Raipur Raipur ACUPR2730C 2017-18 ITO-3(1), ITO-4(4), Raipur Raipur 13. Chandra Prakash BETPP3864D 2017-18 ITO-3(1), ITO-4(4), 14. Inderjit Singh Jasvinder Singh AAAHI1625P Raipur 2017-18 ITO-3(1), Raipur ITO-4(4), Raipur Raipur corold-2 15. Shivbati Sahu AKDPS9561M 2017-18 ITO-3(1), ITO-4(4), Raipur Raipur 16. Bindeshwari Prasad AJNPG3349J 2017-18 ITO-3(1), ITO-4(4), Raipur Raipur Gupta 17. Vivek kumar Dani ARJPD7601G 2017-18. ITO-3(1), ITO-4(1), Raipur Raipur 18.....