The court upheld the CIT(A)'s dismissal of the appeal due to the assessee's failure to provide sufficient evidence for cash deposits, affirming the additions made by the Assessing Officer under Section 69A.

ORDER

This appeal has been preferred by the assessee against the order dated 21.08.2023, passed by the ld. Commissioner of Income Tax (Appeal), National Faceless Appeal Centre (NFAC), Delhi for Assessment Year 2017-18.

2. The brief facts of the case are that the assessee filed his return of income for the year under consideration on 23.08.2017, declaring a total income of Rs.4,45,110/-. The case of the assessee was selected for scrutiny under CASS to examine the cash deposits made by the assessee during the demonetization period. The Income Tax Department was in possession of information that the assessee had deposited substantial cash in his Bank accounts during the demonetization period (09.11.2016 to 30.12.2016). The Assessing Officer (AO) issued statutory notices, requiring the assessee to explain the source of cash deposits in his bank accounts during the demonetization period. After considering the explanations furnished by the assessee, the AO treated Rs.2,23,500/- as unexplained money of the assessee out of the total deposits of Rs.7,23,500/- in old Specified Bank Notes (SBNs) during the demonetization period in Bank Account No.407010100069845 maintained with Axis Bank, Lucknow and added the same to the assessee’s income under section 69A of the Act.

2.1 Likewise, the assessee had made deposits to the tune of Rs.26,27,500/- in his Bank Account No.1890100031752 maintained with Yes Bank, Lucknow during the demonetization period. The submission of the assessee before the AO was that out of total deposits of Rs.26,27,500/-, Rs.24,27,500/- belonged to Shri Rupesh Kumar Singh and Rs.2,00,000/-belonged to Shri Gyan Shankar Shukla. To verify the contentions of the assessee, the AO issued summons to Shri Rupesh Kumar Singh and Shri Gyan Shankar Shukla. Shri Gyan Shakar Shukla attended before the AO and stated on oath that he had given Rs.2,00,000/- to the assessee before demonetization. Whereas Shri Rupesh Kumar Singh stated on oath before the AO that neither he had given any cash to the assessee nor had he deposited any cash in the assessee’s bank account during the demonetization period. The AO, after considering the depositions of Shri Rupesh Kumar Singh and Shri Gyan Shankar Shukla and also the submissions of the assessee, treated the amount of Rs.24,73,500/- as unexplained money and added the same to the income of the assessee under section 69A of the Act.

2.2 The AO completed the assessment under section 143(3) of the Act, computing the income of the assessee as under:

Returned income as per ITR : Rs.4,45,110/-

Addition u/s. 69A of the Act : Rs.2,23,500/-

Addition u/s. 69A of the Act : Rs.24,73,500/-

Assessed income : Rs.31,42,100/-

2.3 The AO also invoked the provisions of section 115BBE of the Act and initiated penalty proceedings under section 271AAC of the Act.

3. Aggrieved, the assessee preferred an appeal before the NFAC who dismissed the appeal of the assessee after duly considering the submissions of the assessee.

4. Now, the assessee has approached this Tribunal challenging the order of the NFAC by raising the following grounds of appeal:

1. BECAUSE on the facts and in the circumstances of the case and in law the Ld CIT-A erred in passing the order dismissing the Appeal without giving reasonable and due consideration to evidences placed before him by the Appellant.

2. BECAUSE the order appealed against is contrary to facts, law and principles of natural justice.

3. BECAUSE the Appellant is Individual and is having limited income from rent and from interest and imposing such harsh order would make an irreparable damage to his finances and reputation

4. BECAUSE it appears that Ld CIT A has summarily decided the Appeal without devoting sufficient time and efforts and without going through the facts of the case diligently as

a. Whereas the Learned Assessing Officer's order mak