2021 (4) TMI 709 - AT - Income Tax

Addition of cash deposit in bank account as undisclosed income - HELD THAT - As during the assessment, the assessee was given ample opportunity to explain the source and nature of cash deposit. Initially, the assessee not disclosed the saving bank account maintained in RBS, however later on admitted the said bank account. The fact remains that assessee failed to substantiate the source of cash deposit in the said bank either before the Assessing Officer or before the ld. CIT(A). Before us, the assessee has neither filed any written submission, nor any documentary evidence to substantiate the grounds of appeal. We have further noted that due to non-cooperation of assessee his Counsel has withdrawn from the proceedings - no merit in the ground of appeal raised by the assessee, thus, we affirm the order passed by the ld. CIT(A). - Decided against assessee.

Summary

Issues:
Addition of cash deposit in bank account as undisclosed income.

Analysis:
The appeal was against the addition of cash deposit in the bank account as undisclosed income for the assessment year 2009-10. The Assessing Officer noted discrepancies in the cash deposits made by the assessee in the ABN Amro Bank account, which were not fully disclosed. The assessee explained the source of deposits, linking them to a loan from HDFC Bank and subsequent business transactions. However, the Assessing Officer found the explanations inadequate and treated the total credit in the bank account as unaccounted income, making an addition of ?17,04,500. The ld. CIT(A) confirmed this addition, stating that the assessee failed to explain the deposit adequately. The interest income addition was deleted by the ld. CIT(A) based on the assessee's admission of the mistake. The Tribunal noted the repeated non-cooperation of the assessee and the withdrawal of the counsel due to lack of contact with the assessee. Despite multiple opportunities, the assessee did not provide written submissions or documentary evidence to support the appeal. Consequently, the Tribunal upheld the order of the ld. CIT(A) and dismissed the appeal with a cost of ?25,000.

The Tribunal found that the assessee failed to substantiate the source of cash deposit in the bank account before both the Assessing Officer and the ld. CIT(A). The assessee did not cooperate in the proceedings, leading to the withdrawal of the counsel. The Tribunal observed that the assessee did not provide any written submissions or documentary evidence to support the grounds of appeal. Due to the lack of cooperation and evidence from the assessee, the Tribunal affirmed the decision of the ld. CIT(A) to add the cash deposit as undisclosed income. The appeal was dismissed with a cost of ?25,000 imposed on the assessee.

In conclusion, the Tribunal upheld the addition of the cash deposit in the bank account as undisclosed income due to the assessee's failure to adequately explain the source of the deposits. The lack of cooperation and evidence from the assessee throughout the proceedings led to the dismissal of the appeal and imposition of a cost of ?25,000.