<\/p>\nWhat the case is about<\/h2>\n<\/p>\n
On May 14, 2007, the senior citizen woman invested Rs 2 lakh in a two-year FD. The deposit matured on May 29, 2009, following which the bank credited Rs 2.41 lakh to her account.Around the same period, she had also deposited Rs 1.06 lakh in cash. Her explanation was that this money represented savings accumulated from her family pension.Her failure to file an income tax return, however, resulted in the Income Tax Assessing Officer (AO) issuing a notice under Section 148 on March 29, 2017.The AO arrived at the income figure through the following components:<\/p>\n\n
\n- Estimated regular income: Rs 1.5 lakh<\/li>\n
- Cash deposited in bank account: Rs 1.06 lakh<\/li>\n
- Deposit through FD: Rs 2.42 lakh<\/li>\n
- Interest income: Rs 16,940<\/li>\n
- Total: Rs 5.15 lakh<\/li>\n<\/ul>\n<\/div>\n
The woman challenged the assessment before the JCIT (A). However, she again did not submit a reply or written submission despite receiving notices for the hearing.The JCIT(A) therefore called for a remand report from the AO. After considering the report, the JCIT(A) upheld the additions totalling Rs 5.15 lakh and dismissed the woman\u2019s appeals, according to an ET report.By the time the final order was passed, nine years had elapsed since she had filed her appeal before the JCIT(A). Following this prolonged delay, she approached the ITAT Jaipur.The tribunal heard the matter on August 6, 2026, and delivered its judgment on August 21, 2026.<\/p>\nWhy ITAT Jaipur ruled in senior citizen woman\u2019s favour<\/h2>\n<\/p>\n
Vipin Upadhyay, Partner at King Stubb and Kasiva, told ET that the woman succeeded before the ITAT Jaipur because the additions to her income were based largely on her failure to respond and her non-filing of an ITR, rather than on actual evidence showing that she had undisclosed income.Once she produced her bank passbook and FD receipt, even though these documents were submitted at the appellate stage, the assumptions on which the additions had been made no longer held.Upadhyay said his regular advice to senior citizens is to file an ITR even when they believe their income is below the taxable limit. Under the new income tax regime, senior citizens do not have to pay income tax when their total income is up to Rs 12 lakh because of the enhanced Section 87A tax rebate. However, filing an ITR is necessary to claim this rebate.There are circumstances in which filing an ITR is not mandatory. For a senior citizen, the threshold is Rs 3 lakh under the old income tax regime and Rs 4 lakh under the new tax regime.A super senior citizen has a basic exemption limit of Rs 5 lakh under the old tax regime. There is also a limited exemption from filing an ITR for individuals above 75 years of age whose income consists only of pension and interest from a single specified bank, subject to the prescribed declaration.According to Upadhyay, these thresholds provide protection only when the information available with the Income Tax Department is consistent with the taxpayer’s own understanding of their tax position. Banks, meanwhile, routinely report transactions such as fixed deposit investments, interest credits and high-value cash deposits.That is what happened in this woman\u2019s case. One of her fixed deposits came to the attention of the Assessing Officer. Since there was no ITR, computation or disclosure available on record, the AO proceeded with a best-judgment assessment. The FD maturity proceeds, cash deposits and an estimated amount described as ‘regular income’ were consequently treated as taxable.The senior citizen woman ultimately succeeded, but reaching that stage took several years. The matter involved a reassessment notice issued nearly seven years after the relevant financial year, an unsuccessful first appeal and then a further appeal before the ITAT Jaipur. The entire process stretched close to a decade.<\/p>\nWhat did the ITAT Jaipur judgment say?<\/h2>\n<\/p>\n
The ITAT Jaipur found that the maturity proceeds from the Rs 2 lakh fixed deposit that Devi had made in 2007 were what led to the assessment proceedings. The relevant entries in her bank passbook for 2007 and 2009 supported the connection, the ET report said.The tribunal consequently found a direct trail between the Rs 2.42 lakh received on maturity of the FD and the original Rs 2 lakh deposited in 2007. It held that the amount credited to her account were her own funds and could not be treated as her income for the year under consideration.The ITAT Jaipur further noted that the AO had made the addition relating to the FD because the person was an aged widow who had neither filed her ITR nor responded to the notices. There was no material before the AO demonstrating that the deposit had originated from an undisclosed source.The tribunal therefore deleted the Rs 2.42 lakh addition relating to the FD.The tribunal also examined the Rs 1.06 lakh cash deposited by the woman. Her bank passbook showed that she had previously made cash withdrawals totalling Rs 2.45 lakh, an amount more than twice the cash deposits made during the relevant year.There was no material on record showing that the money withdrawn earlier had been spent or otherwise utilised. In those circumstances, the ITAT Jaipur considered it reasonable to conclude that the subsequent cash deposits could have come from those earlier withdrawals.It considered this particularly relevant in the case of an aged widow dependent on family pension, whose requirements and savings would ordinarily be modest.Once the woman provided an explanation for the source of the cash deposits, the burden effectively shifted to the AO to establish otherwise. The tribunal found that the AO had not produced evidence to contradict her explanation.The addition of Rs 1.5 lakh towards estimated income was also deleted. The AO had not produced any evidence to support that estimate either. The ITAT Jaipur observed that additions or disallowances cannot be sustained merely on the basis of conjectures and surmises, a principle repeatedly laid down by the Supreme Court.This was the basis on which the senior citizen woman ultimately won her case before the ITAT Jaipur.<\/div>\n
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![\"Senior](\"https:\/\/static.toiimg.com\/thumb\/msid-134019976,imgsize-588663,width-400,height-225,resizemode-4\/tax-notice.jpg\" "\\"The")
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