ITAT Ahmedabad Remands ₹1.47 Crore Section 69A Addition in Education Consultancy Case

The “B” Bench, Ahmedabad of the Income Tax Appellate Tribunal partly allowed the appeal of Parshuram Bindhnath Roy (AY 2017–18) and restored the matter to the Assessing Officer for fresh verification of cash deposits treated as unexplained under Section 69A.

Background: Cash Deposits Treated as Unexplained Money

The assessee, engaged in consultancy services for student admissions, filed a return declaring income of ₹5.31 lakh. The case was selected for scrutiny due to large cash deposits aggregating to ₹1,47,52,000 in multiple bank accounts. During assessment, the Assessing Officer observed that no satisfactory explanation or documentary evidence was furnished regarding the source of these deposits. The entire amount was therefore treated as unexplained money under Section 69A. Before the CIT(A), the assessee claimed that the amounts represented receipts from students on a reimbursement basis, meant to be remitted to colleges. However, in absence of confirmations from institutions, proof of remittances, or reconciliation of receipts and refunds, the addition was confirmed.

Tribunal: Verification Required

Before the Tribunal, the assessee furnished bank-wise break-up of deposits and detailed particulars of student-wise receipts, amounts passed to institutions, and refunds made during the year or subsequent years.

The ITAT observed that these details required proper verification, including examination of:

1. Total amounts received from students;
2. Amounts remitted to institutions;
3. Refunds made;
4. Percentage and timing of repayments.

In the interest of justice, the Tribunal restored the matter to the Assessing Officer to verify the submissions and pass a reasoned order after granting adequate opportunity of hearing.

The appeal was allowed for statistical purposes.