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TMI Blog2025 (4) TMI 657X X X X Extracts X X X X X X X X Extracts X X X X ..... ebtors and that it was own capital of the assessee which has been given the colour of debtors so that the story of cash deposited during demonitization may be explained. Learned CIT(A) has erred in confirming this addition. 3. The assessee carves his right to add, amend or alter any ground before or at the time of hearing of appeal." 3. Succinctly, the facts as culled out from the records are that the case was selected for scrutiny under the limited scrutiny criteria to examine cash deposit for demonetization period (9th Nov. to 30th December) as reported as per specified financial transaction [SFT] reporting as to verify if the cash deposited was derived from disclosed sources. The case was converted for complete scrutiny vide PCIT-2 letter no. 1478 dated 22-12-2017. The assessee had filed her return of income on 31-03-2017 for the A.Y 15-16. The notice had been issued after selection through CASS on 16-09-2017 and the notice was sent through registered post. Ld. AO in the assessment proceedings noted that the assessee deposited cash amounting to Rs. 25,00,000/- during demonetization period stating that the assessee has filed declaration under IDS Scheme 2016. The assessee did ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ON" the burden to prove always lies with the appellant and here in this case the appellant utterly failed to produce the confirmation from the debtors. The appellant has not provided any details like PAN, address, email id etc of the debtors persons to whom such money has been lent by her. This shows non cooperative attitude of the appellant during whole assessment proceedings. Which was already taken into consideration by the AO while passing speaking order after analyzing all the aspects therefore action of the AO is upheld. From the above discussion the AO inferred that the appellant has not been able to substantiate her income to have arised from known sources and further failed to prove the genuineness of such income. The submissions made by the appellant during the appellate proceedings are carefully examined and this appellate authority held that the appellant has submitted the same facts as she had submitted during the course of assessment proceeding. Further, Reliance is also placed in this regard on the decision of Hon'ble Supreme Court in the case of Kale Khan Mohammad Hanif Vs CIT(1963) 50 ITR 1 wherein it was held that "If an assessee fails to prove satisfactor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s observed in his order that the assesse did not submit any documentary evidence in support of this. b) It was further submitted before the AO that case was selected for limited scrutiny to verify that "whether cash deposit has been made from disclosed sources". c) It was submitted before the AO that no such cash was deposited in the bank account of the assessee during the relevant period of AY 2015-16 and copies of bank account were also filed before the AO. (Copies of these bank account are placed at Paper Book page No. 16 to 17) d) It was further informed to AO that it was not possible to obtain balance confirmation from debtors at short notice as notice dated 15/12/2017 was issued by AO requiring for filing of confirmation on or before 18/12/2017. Therefore request was made to seek confirmation under section 131/133(6) of Income Tax Act. Proceedings before CIT(A) a. Before the CIT(A) the assessee filed detailed submissions vide letter dated 13/5/2019 (copy is placed at Paper Book page No 20-24 ) Along with these submissions the assessee also filed comparative chart emphasizing that all the debtors were old debtors. Opening & Closing Balance of the debtors in AY 2015- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of bank accounts at Pb page no. 16-17.) Therefore, the requirement of Limited Scrutiny to verify the source of cash deposit in bank account was fulfilled. c. The learned AO has erred in holding on the first page of the assessment order that 'the case had been selected for scrutiny of the return for AY 2015-16 for limited scrutiny to examine 'cash deposit for demonetization period (9th Nov to 30th December) as reported as per SFT reporting. d. It is submitted that in the notice issued u/s 143(2) dated 19/9/2017, there was no mandate to examine 'cash deposited for demonetization period'. The mandate was only for the cash deposited in the relevant previous year. In any case it is difficult to assume that a mandate was given to examine the ITR of AY 2015-16 to examine the source of cash deposited in AY 2017-18. e. The learned AO has made this addition and CIT(A) has sustained the addition as the assesse did not file copy of declaration made for declaring income of Rs. 25 lacs in IDS Scheme, 2016. 2. It is submitted that, the assesse had filed declaration dated 29/9/2016 under Income Declaration Scheme, 2016 in Form No. 1 for declaring income of Rs. 25 Lacs, and after payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvestigation of documents in his possession it was seen that assessee during year had sold 13 plots in cash and sales consideration received by it remained unexplained and supplied documents to assessee - He thereafter passed an order under section 148A(d) stating that amount of sales consideration received in cash required to be reassessed - Whether stand taken by assessee that it had no knowledge about sale transaction by power of attorney holder was not a ground for revenue not to proceed against it - Held, yes - Whether since a detailed adjudication on merits of information available with Assessing Officer and defence set up by assessee is not contemplated at stage of passing an order under section 148A(d), writ petition was to be dismissed - Held, yes [Para 4] [In favour of revenue] [2024] 166 taxmann.com 253 (Gujarat) Deloitte Haskins and Sells v. Assistant Commissioner of Income-tax* Section 69A read with section 148 of the Income-tax Act, 1961 - Unexplained Moneys - Assessment year 2012-13 - Assessee, a partnership firm, was assessed to income tax for several years - For assessment year 2012-2013, a return of income was filed and later revised, with income remaining ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng demonetization may be explained. He has not brought on record any evidence to support his allegations. 6. Learned CIT(A) has erred in relying on the decision in the case of Hon'ble Supreme court in Kale Khan Mohammad Hanif V CIT (1963) 50 ITR 1, as the facts of this case are clearly distinguishable. This case is applicable on amount received during the accounting year for which no satisfactory explanation about source is offered by the assessee. In our case, no amount was received by the assessee during the accounting year. Rather the addition has been made for the old debtors carried forward from earlier years by the assessee." 6. To support the contention so raised in the written submission reliance was placed on the following evidence / records / decisions: Sr. No. Particular Page no. 1. Copy of Income Tax Return for AY 2013-14 1-3 2. Copy of Income Tax Return and Wealth Tax Return for AY 2014-15 4-9 3. Copy of Income Tax Return for A. Y 2015-16 10-13 4. Copy of notice u/s 143(2) dated 19.09.2017 for Limited Scrutiny 14-15 5. Copy of Bank accounts of the assessee for AY 2015-16 16-17 6. Copy of bank account of the assessee for AY 2017-18 18-19 7. Cop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to prove satisfactorily the source and nature of certain amount received during the accounting year, the assessing officer is entitled to draw the inference that the receipts are of assessable nature." Before we deal with the ground no. 2 of the assessee we would like to see the provision of section 69A of the Act which reads as under : Unexplained money, etc. 69A. Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year. As it is the amount of the sundry debtor already recorded in the books of account are not any money, bullion, jewellery or other valuable article therefore, consid ..... 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