Nirmal Jethalal Modi Vs DDIT/ADIT (ITAT Mumbai)
Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) in Nirmal Jethalal Modi vs DDIT/ADIT dealt with an appeal filed by the assessee challenging the order of the Commissioner of Income Tax (Appeals) [CIT(A)] dated 14 February 2024 under Section 17 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (BMA Act), for Assessment Year 2019–20. The assessee, an Indian tax resident, disputed the assessment of ₹1.56 crore as undisclosed foreign income and assets under Section 10(3) of the BMA Act.
The Assessing Officer (AO) received information that the assessee and his family had financial relations with a Jersey-based institution since 2008, with total assets valued at around USD 200,000. The AO noted that these assets were not disclosed in Schedule FA of the income tax returns for AYs 2012–13 to 2018–19. Summons issued under Section 131 went unanswered, leading to a survey under Section 133A, during which the assessee admitted to maintaining a joint bank account with Standard Chartered Bank, Jersey, along with his wife and son. He confirmed a balance of about USD 200,000 and stated that details were not readily available.
The assessee explained that his father, who conducted business in Sudan, had opened a bank account in the UK, where his earnings were deposited. After his father’s death in 1984, the account was transferred to his mother, who later added the assessee’s name. The account was later shifted to Standard Chartered Bank, Jersey, and in 2008, the names of his wife and son were included. Following his mother’s death in 2017, he became the beneficial owner. He admitted that the interest earned had not been reported in his returns and agreed to rectify it. The bank confirmed that the account had since been closed.
