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Income Tax Appellate Tribunal, “SMC” BENCH: RANCHI
Before: Shri Sanjay Garg & Shri Rajesh Kumar]
This is the appeal preferred by the assessee against the order of the Ld. Commissioner of Income Tax(Appeals)- NFAC, Delhi [hereinafter referred to as ‘Ld. CIT(A)’] dated 30.03.2022 for the assessment year 2017-18. 2. The assessee has assailed the order of Ld. CIT(A) for partly confirming the addition to the tune of Rs. 3,94,027/- as against the addition of Rs. 10,50,000/- made
Facts in brief are that the assessee has filed return of income on 18.03.2019 declaring total income of Rs. 3,86,450/- which was processed u/s 143(1) of the Act. The case was selected for limited scrutiny through CASS forlarge value cash deposits during demonetization period and accordingly statutory notices were duly issued and served to the assessee. The AO noticed that the assesse has deposited Rs. 10,50,000/- into four bank accounts : Corporation Bank, HazaribaghRs. 2,50,000/-, State Bank of India, Rajendra Medical College Campus, Ranchi Rs. 2,49,000/-, Central Bank of India Rs. 2,57,000/- and Indian Overseas Bank, Purulia Road, Ranchi Rs. 2,49,000/- aggregating to Rs. 10,50,000/- The assessee did not give any explanation before the AO despite issuing notice to the assesseeto explain the same and consequently the AO added the entire deposits to the income of the assesse in the assessment framed u/s 143(3) of the Act dated 18.11.2019.
In the appellate proceedings, the assessee submitted before the ld CIT(A) that the assessee has shown in the return of income a cash balance of Rs. 6,55,973/- in AY 2016-17and during AY 2017-18 the assessee has shown income of Rs. 3,86,448/- as per ITR filed. The assessee claimed before the Ld. CIT(A) that the said cash deposits were out of cash accumulated out of savings over the years. The assesse also filed a cash flowwhich was extracted by the Ld. CIT(A) on page 3 of the appellate order. Finally the Ld. CIT(A) partly allowed the appeal of the assessee by deleting the addition to the tune of Rs. 6,55,9743/- while the balance addition of Rs. 3,94,027/- was sustained.
After hearing the rival contentions and perusing the material available on record, we note that the assessee is being regularly assessed to income tax. We have also examined the cash flow tally and find that the deposits were made were out of cash in hand of Rs. 10,50,000/- which was fully explained out of the past savings which was partly accepted by the Ld. CIT(A) and deleted the addition to the extent of Rs. 6,55,973/-. In our opinion, during the year the assessee has returned income of Rs.
3 AY: 2017-18 Sri Anup Anmol Kujur 3,86,448/- so the deposit can reasonably be presumed to be out of current income besides the possibility of having money other than the personal saving which are normally not disclosed in the return of income always and thus that possibility cannot be ruled out. In the time of demonetization the people whohad keptand accumulated money out of past savings in cash and deposited after the said demonetization had no option but to bank the cash. In the case of assesse also the deposits seem to be out of the personal income and savings and accordingly we modify the order of Ld. CIT(A) and direct the AO to delete the addition.
In the result, the appeal of the assessee is allowed.
Order is pronounced in the open court on 5th April, 2023