The Delhi bench of the Income Tax Appellate Tribunal( ITAT) stated that Income tax addition u/s 69A could not be on the grounds of doubt.

Ms Rano Jain, Adv. &Ms Mnsi Jain, CA appeared for the petitioner and Shri Om Parkash appeared for the respondent.

Narender Kumar, the taxpayer opposes the order of Commissioner of Income Tax (Appeals)-13, New Delhi for the assessment year 2010-11 on the basis of the validity of reopening of assessment under Section 147 of the Income Tax Act, 1961 and on the merits of the addition made of Rs.20,00,000 under Section 69A read with section 115BBE of the Income Tax Act.

The taxpayer, resident who losses to file income return under Section 139(1) of the Income Tax Act. The Assessing Officer revealed that the taxpayer had deposited the cash amounting to Rs.20,00,000 in his bank account. Witnessing the same, the Assessing Officer furnished the letter to the taxpayer asking for the data on the cash deposits.

Under Section 147 of the Income Tax Act, Assessing Officer has reopened the assessment in the absence of an answer. In answer to the notice provided under Section 148 of the Income Tax Act, the taxpayer furnishes the income return on displaying the income of Rs.3,866.

The taxpayer, who obtains the amount as a gift via his grandfather Shri Phool Singh, provided a copy of the gift deed and a bank statement of Shri Phool Singh. Dissatisfied by the taxpayer’s submission he figured that the cash deposited sources of Rs 20,00,000 does not have any explanation. Considering the amount as unexplained income, under Section 69A read with section 115 BBE of the Income Tax Act.

The same would be proof to validate the cash deposits source the assessing officer provided with the letter to the taxpayer asking for the details which do not being complied with. The assessing officer would have real material in his possession to form belief for the income escapement and there was a lower sort of data incurred through the taxpayer to elaborate the source of these cash deposits.

A Coram of Shri Saktijit Dey, Judicial Member, because of the unavailability of the donor due to his death, the taxpayer can evident the concern of the gift via additional corroborative proofs which the taxpayer has attempted to prove via providing the gift deed and donors bank statement.

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The same was stated that prior to cancelling the proof that the taxpayer provides, the assessing officer does not have driven any investigation for the legal heir of the deceased Phool Singh along with the cash availability within him. Under Section 133(6) of the Income Tax Act, the assessing officer would have bounded his investigation by providing a single notice.

The Tribunal, additional doubt is been made by disputed addition instead as per the proof and hence deleted the same addition. The assessing officer was effective in reopening the assessment under section 147 of the income tax act, maintaining the reopening validity of the assessment.