Dilipsinh Ranjitsinh Chauhan Vs ITO (ITAT Ahmedabad)
The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench, in the case of Dilipsinh Ranjitsinh Chauhan Vs ITO, invalidated an income tax addition made for unexplained cash deposits after determining that the taxpayer had provided a comprehensive, credible documentary trail supporting the source of the funds, which the Revenue failed to rebut with contrary evidence. The case originated from a reassessment initiated after the Assessing Officer (AO) received Annual Information Return (AIR) data showing cash deposits totaling Rs. 13,01,500/- in the savings bank account of the assessee, an individual engaged in the taxi business, for the Assessment Year 2010-11. The AO treated the deposits as unexplained income under Section 69A of the Income-tax Act.
The assessee consistently explained that the deposits did not represent his own income. Instead, the funds were arranged and deposited by a visa consultant, Shri Siraj Lakdawala, in a joint bank account opened solely to demonstrate sufficient financial balance for the visa applications of the assessee’s son and daughter-in-law for studies in the United Kingdom. To substantiate this explanation, the assessee provided: pay-in slips bearing the signature and PAN details of the visa consultant; bank statements showing the account was a joint account with the consultant as the third holder; evidence that the entire amount was withdrawn shortly after the visa was issued; and the account was subsequently closed. The AO and the Commissioner of Income-tax (Appeals) (CIT(A)) rejected this explanation primarily because the visa consultant, in a statement recorded under Section 131, denied ownership of the funds and instead attributed the cash to the assessee. The CIT(A) upheld the addition, citing the statutory presumption under Section 69A and relying on precedents like the Supreme Court’s ruling in Smt. Amiya Bala Paul v. CIT.
