Income Tax Officer vs Kulbir Singh Arora

Parties Involved

Facts Summary

The assessee, Kulbir Singh Arora, proprietor of M/s R K Jewellery, filed his return of income for AY 2017-18 declaring a total income of Rs. 18,10,030/-. The case was selected for scrutiny, and the AO noted an unpaid liability of Rs. 2,81,91,983/- to M/s Aastha Jewellers. The AO issued a show-cause notice to the assessee, which was returned by postal authorities with remarks 'no such address'. The assessee claimed that the liability was discharged in the next two financial years through account payee cheques. The AO added the sum of Rs. 2,81,91,883/- to the total income of the assessee. The assessee appealed before the Ld. CIT(A), who deleted the addition based on verifiable bank entries totaling Rs.26,94,750/-. The Revenue appealed before the Tribunal. Additionally, the AO noted an abnormal increase in cash deposits of Rs. 67,55,000/- in the assessee's bank account just after the demonetization period, leading to an addition of Rs. 68,41,000/-. The Ld. CIT(A) deleted this addition, which the Revenue also appealed.…

Legal Issues

• 1. Addition of Rs. 2,81,91,883/- on account of unpaid liability to M/s Aastha Jewellers.
• 2. Addition of Rs. 68,41,000/- on account of abnormal cash deposits during demonetization.

Judgment Outcome

Decided in favour of Partly Assessee.

Precedents Relied Upon

Similar Judgements

• ITO, Ward-21(1), Room No.220, C.R. Building, I.P. Estate, New Delhi-110002 Vs M/s Retro Footwear Private Limited

• ITO, Ward-43(1), New Delhi vs. Vinod Kumar Kansal

  Delhi Bench benchAY 2017-18Dismissed

• M/s. Bhanu Jewellers Art vs. ITO

  Ahmedabad bench

• Manoj Kumar Agarwal vs. Income Tax Officer, Ward-45(2), Delhi

  Delhi Bench benchAY 2017-18Allowed

• Punit Jain vs. Income Tax Officer, Ward 51(5)

  Delhi Bench 'F', Delhi benchAY 2017-18Allowed

• Income Tax Officer, 4(1), New Delhi-110014. Vs. Bhasin Jewellers Private Limited

  Delhi Bench ‘A’ benchAY 2017-18Remanded