Deepak Goyal Vs ITO (ITAT Delhi)
In the case of Deepak Goyal vs. Income Tax Officer (ITO), the Income Tax Appellate Tribunal (ITAT), Delhi, addressed the issue of unexplained cash deposits under Section 69A of the Income Tax Act, 1961, for the Assessment Year 2017–18. The appeal arose from an order passed by the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (CIT(A)/NFAC) on November 30, 2023, upholding an addition of ₹10,97,300 to the assessee’s income. The ITAT proceeded ex-parte as the assessee failed to appear despite being called twice.
The Revenue’s contention centered on cash deposits of ₹9,12,000 and ₹2,06,500 made by the assessee during the relevant financial year. The assessee attributed the source of ₹8,00,000 to cash withdrawals made on February 27, 2016, and ₹1,85,300 to cash sales from a trading business in building supplies. While the Revenue did not refute the stated withdrawals or cash sales, it argued that the explanation was incomplete, leaving part of the deposits unexplained.
Taking a balanced view, the ITAT deemed it appropriate to restrict the addition to ₹2,50,000, granting the assessee relief of ₹8,47,300. The Tribunal clarified that the reduced addition should not be construed as precedent for other cases. The appeal was partly allowed in these terms, with the order pronounced in open court on November 21, 2024. This decision highlights the importance of substantiating the sources of cash deposits to mitigate additions under Section 69A.
