Kuldeep Jiwan Mahant Vs ITO (ITAT Raipur)
Income Tax Appellate Tribunal (ITAT), Raipur Bench, in the case of Kuldeep Jiwan Mahant vs. Income Tax Officer (ITO), has set aside an order by the Commissioner of Income Tax (Appeals) [CIT(A)] and directed the Assessing Officer (AO) to delete an addition of Rs. 4,65,000 made under Section 68 of the Income Tax Act, 1961. The tribunal’s decision primarily rested on a legal interpretation of Section 68, specifically whether cash deposits reflected in a bank passbook can be considered “credits in the books of the assessee.”
The case originated when the assessee, Kuldeep Jiwan Mahant, did not file an income tax return for the assessment year 2010-2011. Following the discovery of cash deposits totaling Rs. 12,07,100 in his bank account, the case was reopened under Section 148 of the Act. The assessee subsequently filed a return declaring an income of Rs. 1,36,270. However, the AO assessed a total income of Rs. 14,73,370, making an addition of Rs. 13,37,100 under Section 68 for unexplained cash deposits.
Aggrieved by the AO’s order, the assessee appealed to the CIT(A), who partially allowed the appeal. The assessee then approached the ITAT with two primary grounds:
1. The CIT(A) erred in confirming an addition of Rs. 4,65,000 out of Rs. 13,37,100 made by the AO under Section 68.
2. The CIT(A) failed to adjudicate the ground concerning the non-applicability of Section 68.
During the ITAT proceedings, the assessee’s authorized representative (AR) argued that an amount of Rs. 4,65,000, consisting of Rs. 80,000, Rs. 70,000, and Rs. 3,15,000, was gifted by his mother, Smt. Pushpa J. Mahant. The AR provided evidence including an affidavit from the mother, bank entries showing direct deposits by her from Nagpur, and her capital account reflecting these gifts. The AR also cited reasons for the gifts, explaining the assessee’s long-standing medical condition (Juvenile Rheumatoid Arthritis) requiring expensive treatment and his mother’s financial support. The mother’s source of funds was stated to be agricultural income and borrowings for house repairs related to another family marriage. The AR emphasized that the assessee had provided the donor’s address, PAN, and mobile number, and had requested the AO to make direct inquiries or call the donor, which was not done.
