आयकर अपील(cid:547)य अ(cid:876)धकरण, कोलकाता पीठ “बी’’, कोलकाता

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH: KOLKATA (cid:302)ी राजेश कुमार, लेखा सटèय एवं (cid:302)ी (cid:292)द(cid:547)प कुमार चौबे, Ûया(cid:467)यक सदèय के सम¢

[Before Shri Rajesh Kumar, Accountant Member &Shri Pradip Kumar Choubey, Judicial Member]

Ajay Kumar Agarwal Vs. ITO, Ward-3(1), Gangtok (PAN: AHWPA 2078 B)

Appellant / (अपीलाथ(cid:568)) Respondent / (cid:292)×यथ(cid:568)

Date of Hearing / सुनवाई 18.12.2024 क(cid:551) (cid:467)त(cid:876)थ Date of Pronouncement/ 17.01.2025 आदेश उ(cid:622)घोषणा क(cid:551) (cid:467)त(cid:876)थ For the assessee / Shri Siddharth Agarwal, Advocate (cid:467)नधा(cid:91)(cid:464)रती क(cid:551) ओर से

For the revenue / राजèव Shri Sallong Yaden, Addl. CIT(DR)

क(cid:551) ओर से

ORDER / आदेश Per Pradip Kumar Choubey, JM:

This is the appeal preferred by the assessee against order of Commissioner of Income Tax (Appeal)-NFAC, Delhi (hereinafter referred to as the Ld. CIT(A)] dated

31.07.2024 for AY 2013-14.

2. Brief facts of the case of the assessee is that the assessee being an individual did not file any return of income for the AY 2013-14 despite having credit of total amount of Rs. 43939860/- which included the cash deposit amounting to Rs. 38952038/- through its bank accounts maintained with Union Bank of India, Gangtok Branch. On the basis of information available the case of the assessee was reopened u/s 147 of the Act and notices were issued to the assessee requesting to file a return of income. No response was received from the assessee and when notice u/s 142(1) was again issued the assessee vide its letter dated 05.02.2021 and 10.02.2021 submitted that he is a franchise holder of BSNL at Gangtok, Sikkim and by enclosing a copy of writ petition filed by Association of Old Settlers of Sikkim and others wherein the assessee claims to be a member of above association and the petition relates to grant benefit u/s 10(26)AAA of the Act. The AO after considering the facts of the case and submission of the assessee asked the assessee to submit the details with regard to the cash deposit amount of Rs. 438952038/- during FY 2012-13 in its bank account. No response has been received as a result of which the total income is computed by considering the cash deposit of Rs. 38952038/- in the bank account as unexplained cash credit and added back to the total income of the assessee. Further the estimated profit rate of 8% of the other credit in the bank is also added back to the assessee’s total income.

3. The assessee has preferred the appeal before the Ld. CIT(A) wherein the appeal of the assessee has been dismissed by holding that the assessee had failed to discharge his onus u/s 68 of the Act.

Being aggrieved and dissatisfied the present appeal has been preferred by the assessee.

4. The Ld. Counsel for the assessee challenges the impugned order there was submitting that the AO as well as the Ld. CIT(A) has erred by rejecting the claim of the assessee to grant the benefit of exemption u/s 10(26)AAA of the Act and further the Ld. CIT(A) was not justified in upholding the action of AO in making the addition of Rs. 399025/- being 8% of Rs. 4987822/- being the other credit of the bank ignoring the fact that the assessee was entitled to benefit of exemption u/s 10(26)AAA of the Act. The Ld. Counsel further submits that the assessee is a Sikkim old settler to be assessed as Sikkimese as because he is engaged in the activities earning his income from the State of Sikkim. The return of income in AY 2013-14 was not filed as because his total taxable income of Rs. Nil by claiming exemption u/s 10(26)AAA of the Act. The Ld. Counsel cited a decision of Hon’ble Supreme Court in the case of Association of Old Settlers of Sikkim vs. Union of India reported in [2023] 146 taxman.com 271(SC) and submit that all the individuals domiciled in Sikkim up to 26^th April, 1975 shall be entitled to exemption under the said provision from the current financial year i.e. 1^st April