Bharatbhai Raghavbhai Jograna Vs ITO (ITAT Ahmedabad)
The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench, allowed the appeal of Bharatbhai Raghavbhai Jograna and set aside the assessment, restoring the matter of unexplained bank deposits totaling Rs. 41,02,924 to the file of the Assessing Officer (AO) for a fresh review. The Tribunal’s decision was influenced by the assessee’s claim of illiteracy and lack of awareness regarding electronic communication, which led to a series of non-compliances before the lower tax authorities.
Background of the Case
The case relates to the Assessment Year (A.Y.) 2017–18. The assessee, claiming his income was exempt, did not file a return of income. However, the case was selected for scrutiny after the AO discovered that the assessee had deposited $\text{Rs. 41,02,924}$ into his Federal Bank account during the financial year 2016–17. This amount included cash deposits of Rs. 14,96,500 made during the demonetization period, along with other credit entries, some of which were purportedly from gold loan disbursements.
Due to the assessee’s failure to respond to multiple notices issued under Section 142(1) of the Income-tax Act, 1961, the AO completed the assessment ex parte under Section 144. The entire amount of $\text{Rs. 41,02,924}$ was treated as unexplained money under Section 69A and taxed at the higher rate specified under Section 115BBE.
