TaxTMI 
TaxTMI 
TaxTMI 
2025 (1) TMI 1734
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....tion 115BBE of the Income Tax Act, 1961 for levy of tax @ 60% and surcharge thereon @ 25% on offered income for which explanation was furnished before the learned AO. 2. The assessee craves your indulgence to add, amend or alter all or any grounds of appeal before the learned. AO." 3. Brief facts of the case are that in this case, a search and Seizure action u/s 132A of the I. T. Act, 1961 was carried out at Jaipur airport on 03.09.2018, during the search proceedings, cash of Rs. 24 Lakh seized from the assessee (Smt. Premlata Pandya) and Shri Pradeep Kumar Pandya. 3.1 In this case, the assessee filed his original return of Income on 20.09.2019 for the A.Y. 2019-20 declared total return of Income of Rs. 7,31,460/-. Statutory Notice u/s 143(2) of the Income Tax Act, 1961 issued on 16.03.2020 fixing the hearing on 30.03.2020 by the ITO ward-3(2), Jaipur and thereafter the jurisdiction was transferred to DCIT, Central Circle-4, Jaipur vide order u/s 127 of the Act by the Pr. CIT, Jaipur-1, Jaipur circulated on 11.02.2021. The assessee derives Income from Income from House property, Business of Profession and other source during the year under consideration. Thereafter, ....
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....elongs to her unaccounted and undisclosed income and she offered this amount for taxation for the year under consideration. f) During the assessment proceedings, the appellant submitted copies of ITR with its enclosures ie. Computation of income, Balance sheet, P & L Accounts and copies of documents related to deductions of chapter VIA of the ITRs for verification. From the verification of said submission, it was clear that the cash seized amounting to Rs. 24 Lakhs was remained as unexplained. g) Therefore, the AO had correctly made the addition of cash seized amounting to Rs. 24 Lakhs to the total income of the assessee u/s 69A of the Act. h) Section 69A of the Income Tax Act, 1961 is as under: 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 articles 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 offered by him is not in the of the assessing officer, satisfactory, the money and the value of the....
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....ion 115BBE. l) Recently in April 2024, in the case of Uma Maheshwara Rao Chinni Vs Asst CIT ITA No. 895/Coch/2022-Cochin ITAT holds that once the Assessee is unable to substantiate the source of the seized cash or admits being sourced from unspecified persons, Section 69A would automatically apply, Holds that offering such income under the head Inccome from Other Sources' is inconsequential as for attracting deeming provision of Section 69A and higher tax-rate under Section 115BBE; ITAT holds that once the Assessee hos himself admitted and of non- explanation of the source of income and therefore, Revenue is fully justified in regarding the same as unexplained, both as to its nature and source, Relies upon the SC judgment in Prakash Chand Lunia wherein the SC confirmed the application of Section 115BBE for deemed incomes, ITAT rejects the additional evidence filed by the Assessee in the form of 33 affidavits from his employer, friends and relatives claiming to be owners of seized cash due to delay in furnishing the evidence and contradiction with Assessee's ITR; Holds that the only manner in law in which the Assessee could amend his ITR, is by filing a revised ITR,....
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....d as dispose off. 6. In the result, the appeal is treated as dismissed." 5. Feeling dissatisfied with the above finding of the ld. CIT(A) the assessee filed the present appeal before this tribunal on the grounds as reiterated herein above. To support the grounds so raised the ld. AR appearing on behalf of the assessee has placed reliance on the written submission which reads as under:- "The assessee is an individual, having income under the head "house property", "business & profession" and "other sources". The assessee is engaged in the business of trading rubber bushes used in submersible pumps and trading of fabrics. For the assessment year 2019-20, the assessee filed return declaring total income of Rs. 7,31,460/- on 20/09/2019. A copy of the return of income along with computation of income is available on Paper Book Page No.1-5. In the case of the assessee, a sum of Rs. 24,00,000/- was seized at Jaipur Airport on 03/09/2018 when the assessee was coming from Kolkata. In her statement recorded on 04/09/2018, it was deposed by her that she was not in a position to explain the source of the amount and her husband was competent to explain the entire i....
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....on of Rs. 24,00,000/- u/s 69A of the Income Tax Act, 1961 and thereby applying the provisions of section 115BBE of the Income Tax Act, 1961 for levy of tax @ 60% and surcharge thereon @ 25% on offered income for which explanation was furnished before the learned AO. It is submitted that in the case of the assessee, a sum of Rs. 24,00,000/- was seized at Jaipur Airport on 03/09/2018 when the assessee was coming from Kolkata. In her statement recorded on 04/09/2018, it was deposed by her that she was not in a position to explain the source of the amount and her husband was competent to explain the entire issue. She was even unable to state about her own business activities or about her bank accounts. However, later on, statement of her husband, Shri Pradeep Kumar Pandya was recorded on 4/9/2018. In his statement, he was also unable to explain the source of cash and stated that he would furnish evidences later on regarding the source of the seized cash of Rs. 24,00,000/-. Copy of statement of both of assessee, Smt. Premlata Pandya and her husband, Shri Pradeep Kumar Pandya are available on Paper Book Page No cited supra. During the course of assessment proceedings, a....
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....which have been seized at Jaipur Airport. The above cash seized was fully explained and source of which are regular sales and bank withdrawals of the above firms where the money was withdrawn. However to purchase peace of mind and avoid further waxed litigation we are ready to offer this income as our business income earned by unaccounted activities. You are also requested to adjust the tax liability out of seized cash of R$. 24 Lakhs. We have also made this offer before the investigation of officer and submitted an affidavit in this regard on 19.10.2018. Copy of which is enclosed herewith. The counsel of the assessee has forgotten to include this income at the time of filing of return u/s 139(1) of the IT Act. Now you are requested to accept this offer of income and not to initiate penalty proceedings as well as tax the income at normal rates. Kindly accept our proposal/offer and oblige. It is submitted that the assessee was enjoying income as partner having 30% share in the firm M/s Neha Enterprises and also having income as Proprietor of AB Enterprises. The amount of Rs. 24,00,000/- was, therefore, surrendered for tax as unaccounted business income from these business c....
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.... (ITA No.12106/PUN/2017 (ITAT, B Bench, Pune) dt 26/8/2020 - AY 2013-14 During the course of survey, additional income of Rs. 1,06,32,791/- was offered on the basis of incriminating documents. The Hon'ble ITAT held that the entire income disclosed was attributable to business activity. (4) Ram Swaroop Singhal Vs. ACIT,Sriganganagar (ITA No.145/Jodh/2018 dated 25/05/2018) AY 2014-15 (ITAT, Jodhpur) During the course of survey u/s 133A, assessee offered income of Rs. 10,90,000/- on account of incriminating documents, discrepancy in stock and excess cash found during survey. The assessee disclosed the surrendered income of Rs. 10,90,000/- in the return of income filed for AY 2014-15 as income from business. The Hon'ble ITAT accepted the version of the assessee and held that lower authorities were not justified in taxing the surrendered income u/s 69 of the IT Act. (5) Pr. CIT Alwar Vs. Bajargan Traders (ITA No.258/2017 order dated 22/9/2017 - Hon'ble Rajasthan High Court In this case, unrecorded stock of 70,04,814/-, unrecorded debtors of Rs. 11,95,000/-, unrecorded investment in construction of godown Rs. 19,20,000/- and excess cash of Rs.....
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....the basis of a pocket diary was to be treated as business income of the assessee and the ld. CIT(A) was not justified in directing to apply provisions of Sec. 69/155BBE. (9) Shri Harish Sharma Vs. ITO, Ludhiana (ITA No.327/Chd/2020) order dated 11/5/2021 ITAT, Chandigarh In this case, during the course of survey, a note book was found containing entries of cash collection of Rs. 10 lacs. The assessee surrendered the same and filed return of income accordingly. The AO treated the declared amount of Rs. 10 lacs as unexplained u/s 68 and applied the provisions of Sec. 115 BBE. The ld. CIT(A) confirmed the action of the ld. AO. However, the Hon'ble ITAT held that provisions of Sec. 68 were not applicable and the income declared by the assessee was to be treated as business income on which provisions of Sec. 115BBE were not applicable. (10) Bajaj Sons Ltd Vs. DCIT (ITA No.1127/Chd/2019 AY 2017-18 dated 25/5/2021) ITAT Chandigarh In this case, the Hon'ble ITAT held that provisions of Sec. 68, 69, 69A. 69 B, 69 C are not attracted on the surrendered income to cover any discrepancy as the AO could not point out any discrepancy. It was also held that prov....
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....at the source of cash found has already been explained by the assessee in the assessment proceeding which was not controverted. Ld. AR of the assessee further, submitted that the assessee vide submission dated 15.04.2024 filed with the ld. AO, categorically submitted as under:- "1. That when the assessee was traveling from Kolkata to Jaipur on 04.09.2018. The assessee was intercepted by the income tax department a cash of Rs. 24,00,000/- was seized. Statement of the assessee was recorded. The cash seized was recorded in the regular books of accounts of the assessee. was There a family dispute in In-laws of the assessee. Smt. Premlata Pandya wife of the assessee was co-owner/successor of properties held at District Giridih with her brothers. Her brothers do not want to give the share of Smt. Premlata Pandya. In this regard a case No. 29 of 2014 was also going on in Court of Civil Judge-l, (Senior Division)-Giridih. The assessee and his wife Smt. Premlata Pandya withdraw the cash from his, her wife and her son's proprietorship firm to settle the dispute. But the same was not settled and they return with the cash lying with them. The details of cash withdrawn made by the ....
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....be considered as unexplained and subjected to levy at special rate as per provision of section 69A of the Act r.w.s 115BBE of the Act. The assessee vide statement recorded on 04.09.2020 vide Question No. 10 (APB at page 11) categorically submitted that he will submitted documentary evidence about the source of cash fund in her possession she never disclosed that as undisclosed income. The ld. AO did not prove otherwise explanation given by the assessee; the reply of the assessee so filed has never been considered and the facts cited in their submission so placed on record. The assessee submits details of the source of cash fund from the various concerns as listed in assessee's submission filed on 15.04.2004 that the contention was not controverted by the lower authorities at the time of confirming the addition. As is evident vide para 4.2(b) of the order of the ld. CIT(A) wherein Ld. CIT(A) noted that she has filed an affidavit that the cash seized in her possession is not recorded in her books of account and her unexplained income. Thus, the assessee has also supported her arguments by filing affidavit which has not been controverted. Considering that facts on record and relying o....
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....or other valuable article may be deemed to be the income of the assessee for such financial year." As is very much clear from the records that the assessee has placed on record the details showing the source of cash found in her possession and the provision of section 69A of the Act mandate that when the assessee offers no explanation about the nature of source acquisition of the money then the money so found may be deemed to be the income of the assessee for such financial year. In this case the assessee has already explained the source of the money so found in her possession. The details of cash sourced along with all the details were placed on record vide submission made by the ld. AR of the assessee. Even vide statement recorded which was available before the Assessing Officer and that of the ld. CIT(A) wherein the assessee confirmed that there is no undisclosed income declared by the assessee even in the statement so recorded wherein she stated that he will give a documentary evidence to support the source of cash fund in her possession. Assessee after statement so recorded during the course of assessment proceeding dully supported the withdrawal cash from various concerns ....