2021 (3) TMI 982 - AT - Income Tax

Addition u/s 68 - HELD THAT - As gone into the details of the amount deposited by the assessee in his bank account and came to a conclusion as it can be seen from the record that the assessee had discharged his onus qua identity, creditworthiness and genuineness of the credit. CIT(A) further held that the assessee has already repaid ₹ 5.00 lakhs against the loan of ₹ 7.00 lakhs, however, failed to explain the transaction of ₹ 2.00 lakhs and therefore in the peculiar facts and circumstances affirmed the partly addition of ₹ 2.00 lakhs only. We could not find any material and/or circumstances contrary to the conclusion/observation of the ld. CIT(A), hence, are inclined to dismiss the appeal of the assessee. Appeal filed by the assessee stands dismissed.

Summary

Issues:
1. Appeal against order u/sec. 250(6) of the Income Tax Act, 1961 for A.Y. 2013-14.
2. Partial confirmation of addition u/sec. 68 of the Act by the ld. CIT(A) regarding cash deposits in bank account.

Analysis:
1. The appeal was filed against the order passed by the ld. CIT(A)-1, Visakhapatnam u/sec. 250(6) of the Income Tax Act, 1961 for the A.Y. 2013-14. The assessee raised amended grounds of appeal challenging the orders passed u/sec. 143(3) of the I.T. Act, claiming they were against the facts of the case and provisions of law. The primary contention was the acceptance of cash deposits in the bank account and the failure to accept the remaining amount based on similar facts and credible evidence.

2. The dispute revolved around the addition of cash deposits made by the assessee in two transactions, totaling &8377; 7.00 lakhs, with the AO treating it as a loan from a specific individual who could not explain the source of the amount. In the appeal before the ld. CIT(A), the assessee demonstrated identity, creditworthiness, and genuineness of the credit, even repaying a portion of the loan. However, the ld. CIT(A) confirmed the addition of &8377; 2.00 lakhs, stating the failure to explain this specific transaction.

3. The ITAT, after hearing both parties and examining the material on record, noted the thorough analysis conducted by the ld. CIT(A) regarding the deposited amount. The ld. CIT(A) acknowledged the discharge of onus by the assessee concerning identity, creditworthiness, and genuineness of the credit. While the assessee had repaid a significant portion of the loan, the failure to explain the &8377; 2.00 lakhs transaction led to the partial confirmation of the addition. Finding no material contrary to the ld. CIT(A)'s conclusion, the ITAT dismissed the appeal, affirming the order under challenge.

4. The ITAT pronounced the order, dismissing the appeal filed by the assessee, thereby upholding the decision of the ld. CIT(A) regarding the partial addition of &8377; 2.00 lakhs. The judgment was delivered on the 3rd of March, 2021, by the ITAT Visakhapatnam, with Member (J) N. K. Choudhry and Member (A) D. S. Sunder Singh presiding over the case.