Case Law Details
Deepak Goyal Vs ITO (ITAT Delhi)
In the case of Deepak Goyal vs. Income Tax Officer (ITO), the Income Tax Appellate Tribunal (ITAT), Delhi, addressed the issue of unexplained cash deposits under Section 69A of the Income Tax Act, 1961, for the Assessment Year 2017–18. The appeal arose from an order passed by the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (CIT(A)/NFAC) on November 30, 2023, upholding an addition of ₹10,97,300 to the assessee’s income. The ITAT proceeded ex-parte as the assessee failed to appear despite being called twice.
The Revenue’s contention centered on cash deposits of ₹9,12,000 and ₹2,06,500 made by the assessee during the relevant financial year. The assessee attributed the source of ₹8,00,000 to cash withdrawals made on February 27, 2016, and ₹1,85,300 to cash sales from a trading business in building supplies. While the Revenue did not refute the stated withdrawals or cash sales, it argued that the explanation was incomplete, leaving part of the deposits unexplained.
Taking a balanced view, the ITAT deemed it appropriate to restrict the addition to ₹2,50,000, granting the assessee relief of ₹8,47,300. The Tribunal clarified that the reduced addition should not be construed as precedent for other cases. The appeal was partly allowed in these terms, with the order pronounced in open court on November 21, 2024. This decision highlights the importance of substantiating the sources of cash deposits to mitigate additions under Section 69A.
FULL TEXT OF THE ORDER OF ITAT DELHI
This assessee’s appeal for Assessment Year 2017-18, arises against the order of CIT(A)/NFAC, Delhi dated 30.11.2023 in case No. ITBA/NFAC/S/250/2023- 24/1058347534(1) in proceedings u/s 143(3) of the Income Tax Act, 1961 (in short “The Act”).
2. Case called twice. None appears at the assessee’s behest. It is accordingly proceeded ex-parte.
3. It is emerges during the course of hearing that the able assistance coming from the departmental side that both the learned lower authorities have made section 69A unexplained money addition of Rs.10,97,300/- in the course of assessment framed on 01.12.2019 as upheld in the lower appellate findings.
4. The assessee had admittedly made cash deposits of Rs.9,12,000/- and Rs.2,06,500/- in the relevant previous year and attributed source thereof of Rs.8,00,000/- representing cash withdrawals made on 27.02.2016 and cash sales of Rs.1,85,300/- as previous cash sales. The Revenue could hardly rebut the fact that there is no specific denial of the assessee’s said withdrawal figures as well as cash sales proceeds from trading business in building supplies. The facts also remains that the assessee has not been able to explain source of the impugned cash deposits in entirety.
5. It is deem it appropriate in these peculiar facts and circumstances that a lump sum addition of Rs.2,50,000/- in the given facts and circumstances would be just and proper with a rider that the sale shall not be treated as proceedings in other case. The assessee gets relief of Rs.8,47,300/- in other words. His instant sale of substantive grievance is partly accepted.
6. This assessee’s appeal is partly allowed in above terms. Order Pronounced in the Open Court on 21/11/2024.
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