Addition for cash deposit remanded as bank account was opened by by forging PAN Card and signature

Addition for cash deposit remanded as bank account was opened by someone else by forging PAN Card and signature of assessee.

ABCAUS Case Law Citation
ABCAUS 3469 (2021) (03) ITAT

In the instant case, the assessee had challenged the order passed by the CIT(A) in confirming the addition made u/s 69 of the Income Tax Act 1961 (the Act) by the Assessing Officer (AO) on account of unexplained cash allegedly deposited by the assessee in the Bank account.

As per the information received by the AO cash deposits were made in bank account of two concerns of which the assessee was the proprietor.

Since the said Bank accounts were not disclosed by the assessee in the return of income (ITR) filed, the assessment was reopened by the Assessing Officer and the notice under section 148 was issued.

During the course of assessment proceedings, the assessee denied of having any relation with the two proprietary concerns. 

However, the AO did not accept the explanation in absence of any   credible evidence and added the amount of cash deposits in bank to the total income of the assessee by treating the same as unexplained cash credits.

The CIT(Appeals) did not find merit in the submission of the assessee and confirmed the addition.

The Tribunal noted that the CIT(Appeals) confirmed the addition mainly on the ground that the claim of the assessee of having no relation whatsoever with Proprietorship concerns was not supported by any evidence in the form of a FIR filed by the assessee with the Police Department regarding forgery committed by unknown persons, who had allegedly opened the concerned Bank account by misusing PAN Card of the assessee.

In this regard, the assessee submitted that FIR was indeed filed by the assessee with Police Station but the CIT(Appeals) could not take cognizance of the same as the impugned order was passed   before lodging of the FIR.  

It was further submitted that the assessee had also filed a complaint with the RBI Ombudsman Grievance Cell since no action was taken by the concerned Police Station.

The assessee submitted that matter may be sent back to the Assessing Officer for fresh consideration. He further submitted that   the Assessing Officer may make further inquiry in the matter including getting the forensic report, if required, to verify the claim of the assessee.

Accordingly, the Tribunal set aside the impugned order and restored the matter to the file of the Assessing Officer for fresh consideration with a direction to verify the claim of the assessee in the light of the evidence brought. The Assessing Officer was also directed to cause any further inquiry as he may deem fit in the facts and circumstances of the case.   

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