2015 (10) TMI 1419 - AT - Income Tax

Unaccounted bank deposits - Held that - The assessee is an employee of M/s. JR and Sons. The Assessing Officer and the Commissioner of Income-tax (Appeals) did not believe the version of the assessee for the reason that she was not able to establish the amounts deposited which were subsequently transferred to the account of JR and Sons account. Now the assessee has filed all the details and books of account of JR and Sons, IDBI bank account statement and account copy of auto spare agencies from whom the assessee received the amounts, ICICI bank statement, etc. In view of the details filed by the assessee before us we find that in the interest of justice, these details are necessary to be examined by the Assessing Officer. Therefore, we set aside the order passed by the Commissioner of Income-tax (Appeals) and remit the matter back to the file of the Assessing Officer. The Assessing Officer is directed to examine the details filed by the assessee and then decide the issue afresh in accordance with law after giving opportunity of hearing to the assessee. - Decided in favour of assessee for statistical purpose.

Summary

Issues:
1. Assessment of undisclosed income based on cash deposits in bank accounts.
2. Discrepancy in explanation of source of deposits.
3. Appeal against order of Commissioner of Income-tax (Appeals).

Analysis:
1. The appeal was filed against the order of the Commissioner of Income-tax (Appeals) for the assessment year 2010-11, concerning the assessment of undisclosed income by the Assessing Officer based on significant cash deposits in the assessee's bank accounts. The assessee, an individual, declared total income from salary and other sources. The Assessing Officer observed large cash deposits in the assessee's bank accounts and asked for an explanation, which the assessee attributed to receiving sale proceeds on behalf of a firm she worked for. However, the Assessing Officer deemed the explanation inadequate, resulting in the addition of the deposited amount as undisclosed income totaling Rs. 47,10,385.

2. The matter was taken to the Commissioner of Income-tax (Appeals), who upheld the Assessing Officer's decision due to the lack of a clear connection between the firm's business and the deposits in the assessee's accounts. In the appeal before the Tribunal, the assessee's counsel argued that the amounts deposited were promptly transferred to the firm's account, substantiated with evidence. The Departmental representative supported the lower authorities' orders. Upon review, the Tribunal noted that the assessee had submitted detailed evidence, including bank statements and account copies, to establish the link between the deposits and the firm's transactions. Consequently, the Tribunal set aside the Commissioner's order and remitted the matter back to the Assessing Officer for a fresh decision based on the additional details provided by the assessee.

3. The Tribunal's decision to allow the appeal for statistical purposes was based on the necessity to re-examine the case in light of the new evidence presented by the assessee. By directing the Assessing Officer to review the details submitted and make a fresh determination after affording the assessee a hearing, the Tribunal ensured a fair assessment process aligned with legal requirements. The order was pronounced on May 15, 2015, marking the conclusion of the judicial proceedings in this case.