Gnaneswar Kantekar vs. Income Tax Officer

Parties Involved

Facts Summary

The assessee, Gnaneswar Kantekar, did not file an income tax return for the assessment year 2017-18. An information came to the possession of the Assessing Officer revealing that the assessee had deposited cash to the tune of Rs.10,09,487/- during the demonetisation period. Based on this information, the case of the assessee was selected for scrutiny. The Assessing Officer issued a notice under section 142(1) of the Income Tax Act, 1961, directing the assessee to file the return of income, but there was no response from the assessee. The Assessing Officer completed the assessment under section 144 of the Act and observed credits of Rs.95,79,297/- in the SBI account of the assessee. The Assessing Officer made two additions under section 69A of the Act: Rs.10,09,487/- on account of cash deposit by the assessee during the demonetisation period and Rs.95,79,297/- on account of credits appearing in the bank account of the assessee held with SBI. The assessee filed an appeal before the Commissioner of Income Tax (Appeal) who partly allowed the appeal and directed the Assessing Officer to verify the source of credits of Rs.57,60,186/-. The assessee further filed an appeal before the Income Tax Appellate Tribunal, contending that the Commissioner of Income Tax (Appeal) should have directed the Assessing Officer to verify the source of the entire credit as well as the source of cash deposits during the demonetisation.…

Legal Issues

• 1. Whether the Assessing Officer erred in treating the credits appearing in the bank account of SBI as unexplained credits?
• 2. Whether the Assessing Officer erred in adding the cash deposits by the assessee during the demonetisation?

Judgment Outcome

Decided in favour of Assessee.

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