Case Law Details
Shri Mohan Vs ACIT (ITAT Chennai)
Introduction: In a recent case, the Income Tax Appellate Tribunal (ITAT) in Chennai upheld an addition to an individual’s income tax due to their inability to explain the source of a substantial cash deposit in their bank account. This article provides a detailed analysis of the case of Shri Mohan vs. ACIT and the reasons behind the ITAT’s decision.
Detailed Analysis: The case revolves around an individual, Shri Mohan, who was engaged in the business of selling software consultancy services and providing manpower consultancy. Shri Mohan filed his income tax return for the Assessment Year (AY) 2012-13, declaring a total income of Rs. 3,01,75,820. However, his return was belatedly e-filed on April 4, 2013.
The income tax department selected Shri Mohan’s case for scrutiny and issued the necessary notices under Section 143(2) and Section 142(1) of the Income Tax Act. During the scrutiny, the assessing officer (AO) noticed that a significant amount of cash had been deposited into Shri Mohan’s bank account from October 18, 2011, to December 7, 2011, amounting to Rs. 94,75,000.
The AO requested Shri Mohan to explain the source of these cash deposits and provide supporting evidence. In response, Shri Mohan claimed that he had withdrawn the money for the purpose of purchasing land in June 2011. However, as the land deal did not materialize, he re-deposited the cash into his bank account.
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