Darshnaben Pinkalkumar Patel vs. Income Tax Officer

Parties Involved

Facts Summary

The brief facts of the case are that the Assessing Officer received information that the assessee had deposited a sum of Rs. 10 lakhs in her savings bank account, but the assessee had not filed a return of income for the impugned assessment year. Accordingly, re-assessment proceedings under Section 147 of the Act were started in the case of the assessee. During the course of re-assessment proceedings, the Assessing Officer issued several notices of hearing to the assessee, but there was no response or compliance on the part of the assessee. Accordingly, the Assessing Officer proceeded to complete the assessment on an ex-parte basis under Section 144 of the Act. In the absence of any explanation on the part of the assessee, the assessee added the entire credits amounting to Rs. 10 lakhs in the hands of the assessee as the undisclosed income of the assessee under Section 69 of the Act.…

Legal Issues

• 1. The learned CIT(A) erred in law and on facts in upholding the addition of Rs. 10,00,000/- without appreciating that the deposits were made by the appellant's father, a longstanding agriculturist, from agricultural income and past savings.
• 2. The learned CIT(A) wrongly dismissed genuine evidence such as the gift deed and land records as afterthoughts, without providing valid reasons or initiating further inquiry or verification.
• 3. The learned CIT(A) failed to consider that the appellant had no taxable income during the relevant year and was not required to file a return, and that any failure to respond earlier stemmed from circumstances beyond her control, including her change of residence post-marriage and a lack of legal awareness.
• 4. The learned CIT(A) passed the order without giving due weight to the substantive submission dated 25.09.2021 and the documentary evidence on record, thus denying the appellant a fair and just opportunity to explain her position.
• 5. The addition made under Section 69 is unjustified, as the cash deposits were either from exempt income (gift from a relative) or agricultural income, both of which are outside the scope of taxable income and supported by relevant documentation.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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