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Facts
The assessee, a senior citizen, had cash deposits during demonetization. The lower authorities treated these deposits as unexplained under Section 69A read with Section 115BBE. The assessee argued that these deposits were from his regular business, rental income, and past savings.
Held
The Tribunal acknowledged the assessee's business activities and property ownership. While not commenting on merits, a lump sum addition of Rs.14,65,500/- was made to cover the nexus, not as a precedent, granting the assessee relief of Rs.30,00,000/-. Regarding Section 115BBE, it was directed to be applied only for transactions on or after 01.04.2017.
Key Issues
Whether the cash deposits during demonetization can be treated as unexplained income without considering the assessee's established business activities and savings, and the applicability of Section 115BBE.
Sections Cited
143(3), 69A, 115BBE
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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. Satbeer Singh Godara
Asstt. Year : 2017-18 Narender Khetwani, Vs Income Tax Officer, 26, Gadaipur Mehrauli, M. G. Road Ward-29(6), Mehrauli, New Delhi-110030 New Delhi-110030 (APPELLANT) (RESPONDENT) PAN No. AATPK4735D Assessee by: Sh. Rohan Sogani, CA Revenue by : Sh. Manoj Kumar, Sr. DR Date of Hearing: 01.07.2025 Date of Pronouncement: 01.07.2025 ORDER
This assessee’s appeal for Assessment Year 2017-18, arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2024-25/1071997153(1) dated 08.01.2025, 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.
A perusal of the instant case file reveals at the outset that both the learned authorities have treated the assessee’s cash deposits during demonetization amounting to Rs.44,65,500/-; as unexplained u/s 69A r.w.s. 115BBE of the Act, in the assessment order dated 24.12.2019 and upheld in the lower appellate discussion.
Narender Khetwani 4. It is in this factual backdrop that the assessee through his learned counsel vehemently argues that both the lower authorities herein have erred in law and on facts in treating the above cash deposits as unexplained despite the fact that he is a senior citizen who has been assessed all along for his regular business activities in Khopra Oil and allied products as well as cash rental income from house property and past accumulated family savings. The assessee could hardly dispute that he has not been able to explain his case before the learned lower authorities all along by way of filing the relevant cogent evidence. The fact however remains that the department could neither dispute the assessee’s above business activities nor the fact that he has been owning the corresponding house property as well in principle. Be that as it may, it is thus deemed appropriate in the larger interest of justice and without commenting merits of the case that a lump sum addition of Rs.14,65,500/- would be just and proper to take care of all the assessee’s nexus including his case with a rider that the same shall not be treated as a precedent. Ordered accordingly. The assessee gets relief of Rs.30,00,000/- 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. Narender Khetwani 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.