BatHina Srilakshmi Vs ITO (Andhra Pradesh High Court)
The Andhra Pradesh High Court considered an appeal filed against the order of the Income Tax Appellate Tribunal (ITAT), Hyderabad Bench, relating to the assessment year 2014–15. The appellant had originally filed a return declaring an income of Rs.2,48,490. During assessment proceedings, the Assessing Officer observed that the appellant had a cash balance of Rs.2,01,83,834 as on 01.03.2014 but had made cash payments exceeding the available amount. This resulted in a negative cash balance of Rs.1,82,34,150 as on 26.03.2014. The Assessing Officer treated this deficit as income from unexplained sources, rejecting the appellant’s claim that the amount was covered by cash gifts of Rs.1.83 crores.
The appellant challenged the assessment before the Commissioner of Income Tax (Appeals), who accepted her explanation regarding receipt of cash gifts and allowed the appeal. The department then appealed to the ITAT, which reversed the Commissioner’s decision and upheld the assessment order.
Before the Assessing Officer, the appellant had submitted that she received cash gifts from unspecified “others” and provided self-signed receipt vouchers for Rs.1.83 crores. The Assessing Officer rejected this explanation due to lack of details regarding the identity, creditworthiness, and reasons for such gifts, concluding that the claim was an attempt to explain the negative cash balance.
