Sudhirbhai Pravinkant Thaker Vs ITO (ITAT Ahmedabad)
Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench, on September 21, 2015, delivered a ruling in favor of assessee Sudhirbhai Pravinkant Thaker, setting aside an addition of Rs. 10,44,800 made by the Assessing Officer (AO) and partially confirmed by the Commissioner of Income Tax (Appeals) [CIT(A)]. The dispute centered on cash deposits made into the assessee’s savings bank account, which the tax authorities deemed income from undisclosed sources for the Assessment Year 2008-09.
Case Background
The assessee’s case was selected for scrutiny, and the AO, via an order dated November 30, 2010, made an addition of Rs. 11,27,800. This amount represented cash deposited into the assessee’s ICICI Bank Ltd. savings account. The assessee argued that these deposits originated from prior withdrawals from the same bank account.
The AO rejected this explanation, noting a significant time gap between the withdrawals (primarily in July 2006) and the deposits (in June 2007). On appeal, the CIT(A) upheld the addition in principle but reduced the amount to Rs. 10,44,800. Aggrieved by this decision, the assessee brought the matter before the ITAT.
Assessee’s Submissions before ITAT
The assessee’s counsel argued that the tax authorities were not justified in making the addition. It was submitted that the assessee maintained a cash book and bank passbook, both of which were presented to the AO and CIT(A). Bank statements for the financial years 2006-07 and 2007-08 were also provided. The counsel asserted that these documents clearly established the source of the cash, demonstrating a positive cash balance from which the deposits were made.
