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Facts
The assessee appealed an addition of Rs. 18,80,000/- made under Section 69A read with Section 115BBE of the Income Tax Act, 1961, for Assessment Year 2017-18. The addition pertained to cash deposits made during demonetization, which the assessee claimed represented cash sale consideration of a chocolate making machine.
Held
The Tribunal acknowledged that the assessee had provided voluminous evidence supporting the cash sale claim. However, it found that the evidence was not fully proven to the satisfaction of the lower authorities. Consequently, the Tribunal reduced the addition to Rs. 3,00,000/- as a lump sum, stating it should not be treated as a precedent.
Key Issues
Whether the cash deposits made during demonetization, claimed as sale consideration for a machine, were adequately substantiated and correctly assessed under Section 115BBE.
Sections Cited
144, 69A, 115BBE, 143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. Satbeer Singh Godara
Asstt. Year : 2017-18 N N Foods, Vs Income Tax Officer, House No. A-3, 2nd Floor, Model Ward-34(6), Town, Part-1, Delhi-110009 New Delhi-110002 (APPELLANT) (RESPONDENT) PAN No. AALFN4923C Assessee by: Sh. Ajay Wadhwa, Adv. & Ms. Ragini Handa, Adv. Revenue by : Sh. Manoj Kumar, Sr. DR Date of Hearing: 03.07.2025 Date of Pronouncement: 03.07.2025 ORDER This assessee’s appeal for Assessment Year 2017-18, arises against the Addl./JCIT(A)-10, Mumbai’s DIN & order No. ITBA/APL/S/250/2024-25/1072830988 (1) dated 03.02.2025, in proceedings u/s 144 of the Income Tax Act, 1961 (in short “the Act”).
Heard both the parties at length. Case file perused.
Coming straightway to the assessee’s sole substantive grievance pressed during the course of hearing challenging both the learned lower authorities’ action making section 69A r.w.s. 115BBE addition of Rs.18,80,000/- deposited during demonetization, Mr. Wadhwa has invited the tribunal’s attention to his detailed paper book running into 58 pages that the same represents cash sale consideration of chocolate
Learned departmental representative has drawn strong support from both the lower respective findings treating assessee’s above cash deposits as unexplained attracting higher rate of taxation u/s 115BBE of the Act.
I have given my thoughtful consideration to the assessee’s and the department foregoing vehement rival submissions. The fact remains that although the assessee has filed the above overwhelming voluminous evidence in support of it’s contentions that the impugned cash deposits infact represents cash sale consideration of the above machinery which could not be pleaded and proved with all the relevant facts to the entire satisfaction of the learned lower authorities. This is indeed besides the point that both the learned lower authorities have also not been given any material to rebut the same in their respective discussions. Be that as it may, it is thus deemed appropriate in this factual backdrop and in the larger interest of justice that a lump sum addition of Rs.3,00,000/- only would be just and proper with a rider that the same shall not be treated as a precedent. The assessee gets relief of
So far as assessee’s assessment under Section 115BBE is concerned, I 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.