Ganesan Nakkeeran Vs ITO (ITAT Chennai)
In Ganesan Nakkeeran Vs ITO (ITAT Chennai), the case concerned the addition of ₹51.20 lakh as unexplained cash credit under Section 68 of the Income Tax Act for AY 2010-11. The case was reopened after information surfaced about significant cash deposits in the assessee’s HDFC bank account, exceeding ₹10 lakh, and share transactions linked to the account. The assessee claimed the deposits were used for purchasing shares on behalf of his non-resident brother-in-law, Mr. Maruthuvanan Senthil Nathan, based on a power of attorney. However, investigations revealed discrepancies, including that the referenced bank account did not belong to Mr. Senthil Nathan. Without corroborative evidence, the Assessing Officer (AO) treated the deposits as unexplained and added them to the assessee’s taxable income, which the CIT(A) later upheld.
Upon appeal, the ITAT noted that the assessee had failed to substantiate the claims before lower authorities but allowed another opportunity in the interest of natural justice. The tribunal set aside the CIT(A)’s order and remanded the case for reassessment, directing the assessee to provide necessary evidence. The decision emphasizes the importance of procedural fairness while balancing the responsibility of taxpayers to substantiate their claims with proper documentation.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
