Salvantsingh Swarupsingh Pallu Vs ITO (ITAT Ahmedabad)
The Income Tax Appellate Tribunal (ITAT) of Ahmedabad has ruled in favor of an assessee, Salvantsingh Swarupsingh Pallu, by overturning an Income Tax Officer’s (ITO) decision to disallow Rs. 6,78,400 in cash deposits. The ITO had treated the amount as an unexplained investment under Section 69 of the Income-tax Act, 1961, during the assessment year 2012-13. The ITAT’s decision was based on the assessee’s substantiated claims that the cash originated from a combination of agricultural, transportation, and family income, as well as past savings and loan repayments.
The case originated when the ITO initiated proceedings against the assessee after discovering cash deposits totaling Rs. 18,77,600 across two bank accounts. The assessee, a farmer with a small transportation business, filed a return of income, declaring income from both his business and agricultural activities. Although the ITO accepted a portion of the agricultural income, they deemed Rs. 6,78,400 unexplained and added it to the assessee’s taxable income. An appeal to the Commissioner of Income-tax (Appeals) was unsuccessful, as the appeal was dismissed for alleged non-compliance with notices and a lack of supporting documents.
In the appeal to the ITAT, the assessee’s representative argued that the initial authorities failed to properly consider the documentary evidence provided, which included land ownership records, a certificate from a village official confirming agricultural activities, a cash book, bank statements, and confirmations from family members. The assessee’s claim was that the deposits were sourced from his agricultural income, his wife’s dairy income, his son’s income and savings, and repayment of loans given in a previous year.
