INCOME TAX OFFICER, DELHI vs. EUROSPA TERRYTOWELS PVT. LTD., DELHI
Income Tax Appellate Tribunal, DELHI BENCH ‘B’ NEW DELHI
Before: SHRI SATBEER SINGH GODARA & SHRI MANISH AGARWALAssessment Year: 2017-18
PER SATBEER SINGH GODARA, J.M:
This Revenue’s appeal for assessment year 2017-18 arises against National
Faceless Appeal Centre (NFAC) Delhi’s’ order dated 10.06.2024 [DIN & Order
No. ITBA/NFAC/S/2024-25/1065518421(1)], in proceedings u/s 143(3) of the Income-tax Act, 1961, hereinafter referred to as the ‘Act’.
Heard both the parties. Case file perused.
2. It transpired at the outset that the Revenue’s sole substantive ground raised in the instant appeal seeks to revive the Assessing Officer’s action treating the 2
ITO v. Eurospa Terrytowels P Ltd.
A.Y. 2017-18
assessee’s cash deposits of Rs. 81,00,000/- as unexplained u/s 68/69/69A, as the case may be, and therefore liable to be taxed u/s 115BBE of the Act @ 60%.
That being the case we sought to verify the total tax effect involved in the Revenue’s instant appeal. Ld. Sr. DR, submits that the ld. AO has computed the same at Rs. 62,57,250/-. However, we find no merit in the above computation, once Hon’ble Madras High Court in the case of SMILE Microfinance Ltd. v. ACIT in WP(MD) No. 2078 of 2020 & 1742 of 2020 dated 19.11.2024 (Mad.) has already settled the issue that Section 115BBE applies on transactions on or after 01.04.2017 only. We thus conclude that going by the consequential tax effect computation the Revenue’s instant appeal is hit by the CBDT Circular No. 09 of 2024 dated 17.09.2024 on account of low tax effect, as per the normal provisions. Revenue’s instant appeal is dismissed
Order pronounced in open court on 04.08.2025. (MANISH AGARWAL)
JUDICIAL MEMBER
Dated: 04.08.2025. *MP*