ITO vs. Kamleshbhai Prajapati

Parties Involved

Facts Summary

The brief facts of the case are that the Assessing Officer observed that during the period of demonetization from November 8, 2016, to December 30, 2016, the assessee Shri Kamleshbhai Prajapati deposited a sum of cash totalling Rs 12,50,000/- into his bank account, using old currency notes of Rs. 500/- and Rs. 1000/-. However, the assessee did not file his Income Tax Return (ITR) for Assessment Year (A.Y.) 2017-18, as a result of which several notices were issued by the Assessing Officer. On March 13, 2018, the Assessing Officer issued a notice under Section 142(1) of the Income Tax Act, requiring the assessee to submit a true and correct return of income by March 31, 2018. Despite multiple notices sent through registered email and speed post, the assessee failed to comply. It was only after these notices that the assessee filed a belated return on June 11, 2019, which was deemed invalid by the Assessing Officer, since it was submitted past the due date under Section 139 of the Act. During the course of assessment proceedings, the assessee provided details of his business activities, submitting that he operated a retail kirana store. The assessee submitted documents such as cash books, purchase registers and a profit and loss account. The Assessing Officer issued a show cause notice on September 23, 2019, to which the assessee responded on September 27, 2019, giving details of his background and business operations. The assessee submitted that the majority of his cash deposit…

Legal Issues

• 1. Whether the CIT(A) has justified in law and on facts in deleting the addition of Rs.1,16,53,881/- made u/s 69A of the Act on account of unexplained cash deposits without appreciating the facts of the case?
• 2. The appellant craves leave to amend or alter any ground or add a new ground, which may be necessary.

Judgment Outcome

Decided in favour of Partly Assessee / Partly Revenue.

Precedents Relied Upon

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