Anil Kumar Singhal Vs ITO (ITAT Delhi)
Assessee’s case was reopened u/s 147 based on information that he deposited ₹4.65 crore cash in bank accounts without explaining the source. During reassessment, AO found total deposits of ₹8.21 crore (cash & cheque) and, unsatisfied with Assessee’s explanation of pottery trading, treated the entire sum as unexplained money u/s 69A.
Before CIT(A), Assessee argued that deposits represented turnover from his pottery trading business in Khurja. Observing that both deposits & withdrawals existed &that estimation was unavoidable in such trade, CIT(A) restricted the addition to 5% of total deposits (₹11.27 crore), considering it as reasonable business profit.
Before ITAT, Assessee remained unrepresented. Departmental Representative supported CIT(A)’s findings. Tribunal noted absence of any new evidence from Assessee & found no infirmity in CIT(A)’s pragmatic estimation, which balanced commercial realities &revenue protection.
Accordingly, ITAT dismissed the appeal, affirming CIT(A)’s 5% profit estimation on total deposits.
Held: Entire ₹8.21 crore addition u/s 69A rightly restricted to 5% profit on deposits; estimation reasonable given trade nature; appeal dismissed.
FULL TEXT OF THE ORDER OF ITAT DELHI
This appeal of the assessee for Assessment Year (‘AY’) 2011-12 is directed against the order dated 27.10.2022 of the Commissioner of Income Tax (Appeals), NFAC, New Delhi [‘CIT(A)’].
