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Facts
The assessee's appeal for AY 2022-23 arose against an order upholding the addition of Rs. 10,60,000/- as unexplained cash deposits. The assessee was assessed for construction business, and the cash deposits were prima facie considered as business turnover.
Held
The Tribunal held that while the assessee's explanation for cash deposits was rejected, the deposits represented business turnover. A lump sum addition of Rs. 1,00,000/- was deemed appropriate, not to be treated as a precedent.
Key Issues
Whether cash deposits prima facie represent business turnover even if the explanation is rejected, and what is the appropriate addition to be made.
Sections Cited
143(3), 68, 115BBE, 44AD
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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. Satbeer Singh Godara
Asstt. Year : 2022-23 Shahid Chaudhary, Vs CIT(A), Bhojpur, Near Sawan Photostate, CGO Complex, Hapur Road, Bhojpur, Modi Nagar, Ghaziabad-201001 Ghaziabad-201204 (APPELLANT) (RESPONDENT) PAN No. AHNPC3840L Assessee by: None Revenue by : Sh. Manoj Kumar, Sr. DR Date of Hearing: 21.07.2025 Date of Pronouncement: 21.07.2025 ORDER This assessee’s appeal for Assessment Year 2022-23, arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2024-25/1070295584(1) dated 12.11.2024, in proceedings u/s 143(3) of the Income Tax Act, 1961 (in short “the Act”). Adjournment rejected.
Case called twice. None appears at the assessee’s behest. He is accordingly proceeded ex-parte.
Learned department representative vehemently argues during the course of hearing that both the lower authorities herein have rightly assessed the assessee’s cash deposits of Rs.10,60,000/- as unexplained u/s 68 r.w.s. 115BBE of the Act in assessment order dated 16.02.2024 and upheld in the lower appellate discussion.
Shahid Chaudhary 4. I have given my thoughtful consideration to the assessee’s and the Revenue’s foregoing vehement pleadings against and in support of the impugned section 68 unexplained cash credits addition. The Revenue could hardly dispute the clinching fact that it has already assessed the assessee as engaged in construction business involving labour work for repair and maintenance of residential house declared u/s 44AD of the Act. The necessary inference; even if the assessee’s explanation regarding his cash deposits is rejected, which would arise in the given facts is that the impugned cash deposits prima facie represent his business turnover only although satisfactorily reconciled and verified in both the lower proceedings. That being the case and in the larger interest of justice, it is deemed appropriate that a lump sum addition of Rs.1,00,000/- only would just and proper with a rider that the same shall not be treated as a precedent. The assessee gets relief of Rs.9,60,000/- in other words. Necessary computation shall follow as per law.