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Facts
The assessee's cash deposits of Rs. 3.09 crore during demonetization were treated as undisclosed income under Section 68 by lower authorities. The assessee argued these deposits were part of regular business turnover, supported by audited books.
Held
The Tribunal partly allowed the appeal, confirming a lump sum addition of Rs. 10 lakh and granting relief of Rs. 1.15 crore. It held that Section 115BBE applies only to transactions post-April 1, 2017, directing assessment under normal provisions.
Key Issues
Whether cash deposits during demonetization could be treated as unexplained income under Section 68 of the Income Tax Act, and the correct applicability of Section 115BBE.
Sections Cited
143(3), 68, 115BBE
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Income Tax Appellate Tribunal, DELHI BENCH ‘C’, NEW DELHI
Before: Sh. Satbeer Singh Godara & Sh. Avdhesh Kumar Mishra
ORDER
Per Satbeer Singh Godara, Judicial Member:
This assessee’s appeal for Assessment Year 2017-18, arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2024-25/1068493517(1) dated 10.09.2024, in proceedings u/s 143(3) of the Income Tax Act, 1961 (in short “the Act”).
Heard both the parties at length. Case file perused.
It transpires during the course of hearing that the assessee/appellant herein is aggrieved against both the learned lower authorities’ action treating it’s cash deposits during demonetization of Rs.3,09,43,000/- as income from undisclosed sources u/s 68, in assessment order dated 31.12.2019 and
Learned counsel vehemently argues in this factual backdrop that both the lower authorities herein have erred in law and on facts in rejecting the assessee’s explanation supported by all of it’s duly audited books claiming the above cash deposits as part of regular business turnover in kite/manja business activities. He thus reiterates the assessee’s pleadings all along as well as quotes a “catena of case law” that such cash deposits duly supported by detailed evidence could not be treated as unexplained as it has been done by both the lower authorities.
We have considered the assessee’s and the Revenue’s vehement submissions reiterating their respective stands. We find no reason to accept either parties stand in entirety. This is for the precise reason that neither the assessee has been able to plead and prove the impugned cash deposits as it’s regular business turnover to the entire satisfaction of both the learned lower authorities all along nor the department has been able to rebut all of it’s evidence prima facie indicating it’s regular business activities and books of account. Be that as it may, we are of the considered view in this factual backdrop that a lump sum addition of Rs.10,00,000/- in the given facts and Yamuna Industries Ltd. circumstances of the case over and above, the assessee’s books result would be just and proper with a rider that the same shall not be treated as a precedent. The assessee gets relief of Rs.1,15,97,896/- in other words. Necessary computation shall follow as per law.
So far as assessee’s assessment under Section 115BBE is concerned, we quote S.M.I.L.E Microfinance Limited Vs. The ACIT CC-1 in W.P.(MD) No.2078 of 2020 & W.M.P. (MD) No. 1742 of 2020 held that the said provision applied for transactions done on or after 01.04.2017 only. The assessee is accordingly directed to be assessed under normal provisions only.