TMI Blog2021 (1) TMI 731X X X X Extracts X X X X X X X X Extracts X X X X ..... eived by him before recording the reasons for reopening of the assessment. Thus, there was clearly non-application of mind on the part of the A.O. to initiate the re-assessment proceedings. The A.O. would not get assumption of jurisdiction legally to frame the re-assessment under section 147/148. In view of the above, we set aside the Orders of the authorities below and quash the reopening of the assessment. - Decided in favour of assessee. - ITA.No.6701/Del./2019 (Assessment Year 2011-2012) - - - Dated:- 1-1-2021 - SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER For Assessee : Shri Shantanu Jain, Advocate For Revenue : Mr. Sri Prakash Dubey, Sr.DR ORDER PER BHAVNESH SAINI, J.M. This appeal by assessee has been directed against the Order of the Ld. CIT(A)-16, New Delhi, Dated 28.05.2019, for the A.Y. 2011-2012, challenging the reopening of the assessment under section 147/148 of the I.T. Act, 1961 and addition of ₹ 11,07,160/-. 2. We have heard the Learned Representatives of both the parties through video conferencing and perused the material on record. 3. Briefly the facts of the case are that proceedin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the previous year exceeded the maximum amount which is not chargeable to income tax. 6. In view of the above fact, case, I have the reasons to believe that a sum of ₹ 11,09,693/- on account of cash deposit in bank and commission payments received by the assessee during the year chargeable to tax has escaped assessment. Since, four years have lapsed but not more than six years have elapsed from the end of the relevant assessment year, It is therefore, proposed as per the provisions of section 149(1) (b) read with section 151(3) of the I.T Act, 1961 that approval for initiating action u/s 147 of income tax Act, 1961 may be granted in the case. It is pertinent to mention here that in this case the assessee has chosen not to file return of income for the year under consideration although the total income of the assessee had exceeded the maximum amount which is not chargeable to tax as discussed in paragraph 4 above and the assessee was assessable under the Act. In view of the above, the provisions of clause (a) of Explanation 2 to section 147 are applicable to facts of this case and the assessment year under consideration is deemed to be a case where income chargeab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee in response to the notice, filed return of income declaring income of ₹ 99,200/-. During the year, assessee had declared salary income only. The reasons for reopening of the assessment have been provided to the assessee. The assessee was asked to explain nature of source of entry of ₹ 14,75,000/- in S.B. account of the assessee. The A.O. noted that assessee has not filed satisfactory explanation regarding cash deposit in Axis Bank, therefore, it was treated as unexplained deposit under section 69A of the I.T. Act and made the addition of ₹ 14,75,000. 3. The assessee challenged the above addition before Ld. CIT(A) and it was submitted that assessee is Maulvi for Arabic Religious and Teacher and teaching Arabic in the Masjid. He has prestige in the society and trustworthy in the community. People coming to him for pious purposes, giving money for safe deposit and take back whenever required. The assessee deposited the amount in bank account which was later on withdrawn and returned to them. Assessee gets salary from Waqf Board, Delhi. 4. At the appellate stage, assessee was asked to produce lenders for their statements. The assessee produced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Department that assessee has made cash deposits of ₹ 14,75,000/- in his Bank Account, therefore, income chargeable to tax has escaped assessment. The ITAT, Delhi Bench in the case of Shri Arvind Yadav (supra) considering the identical facts held that the deposit in the bank account per se cannot be the income of the assessee. This is a mere suspicion of the A.O. based on incorrect fact that income chargeable to tax has escaped assessment and accordingly, quashed the reopening of the assessment. The findings of the Tribunal in para 8 of the Order are reproduced as under: 8. In this case the Assessing Officer after obtaining the AIR information wanted to verify the same and issued a letter of enquiry to the assessee. The Assessing Officer thus did not apply his independent mind to the information received from AIR. Since no proceedings were pending before the Assessing Officer when he issued a letter of enquiry to the assessee, therefore, such enquiry letter was not valid in eyes of law. Therefore, the assessee was not required to respond to invalid letter of enquiry issued by the Assessing Officer. The Assessing Officer in the absence of reply of the assessee presumed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g of the assessment in the paper book which is reproduced above in which the A.O. has mentioned that he has information that assessee has deposited cash amounting to ₹ 11,07,160/- with ICICI Bank Ltd., and also received commission of ₹ 2,533/- and thus, there is an escapement of income to the tune of ₹ 11,09,693/-. The assessee has filed copy of the reply filed before the Ld. CIT(A) in the paper book in which it is clearly explained that A.O. has wrongly assumed that entire cash deposited in the ICICI Bank account was income of the assessee as there are deposits and withdrawals multiple times throughout the year for business purposes. It was also explained that assessee in the business during the relevant year because assessee deals in Hardware, Sanitary and Sanitary-ware at Chawdi Bazar, Delhi. These facts clearly show that total cash deposited in the Bank Account of the assessee with ICICI Bank Ltd., per se may not be the income of the assessee. The ITAT, Delhi Bench in the case of Shri Abrar Ahmad Qasimi, Delhi vs., ITO, Ward-46(5), New Delhi (supra), following other decisions of the Tribunal has held that deposits in the bank account per se cannot be the incom ..... X X X X Extracts X X X X X X X X Extracts X X X X
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