SUDHIR KUMAR,MUZAFFARNAGAR vs. INCOME TAX OFFICER 2(4), MUZAFFARNAGAR

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ITA 5563/DEL/2024Status: DisposedITAT Delhi26 June 2025AY 2017-18Bench: Sh. Satbeer Singh Godara (Judicial Member)1 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal acknowledged the possibility of cash receipts in the 'Arathiya' business. While the assessee has the duty to prove credit entries, considering the larger interest of justice, a lump sum addition of Rs.3,50,000/- was deemed appropriate without creating a precedent. The assessment under Section 115BBE was also addressed, citing a precedent regarding its applicability.

What were the facts?

The assessee's appeal concerned assessment year 2017-18, arising from proceedings under Section 147. The lower authorities had assessed cash deposits of Rs.86,70,000/- as unexplained, later restricted to Rs.36,57,400/-. The assessee claimed to be engaged in the 'Arathiya' business.

What were the issues?

Whether the entire cash deposits were unexplained and if Section 115BBE applies to the transactions.

Which sections of the Income-tax Act were involved?

Section 147,Section 115BBE

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI

Before: Sh. Satbeer Singh Godara

For Respondent: Ms. Indu Bala Saini, Sr. DR
Hearing: 26.06.2025Pronounced: 26.06.2025

Asstt. Year : 2017-18 Sudhir Kumar, Vs Income Tax Officer, Kamal Nagar, Kukra, Muzaffarnagar, Ward-2(4), Uttar Pradesh-251001 Muzaffarnagar, Uttar Pradesh-251002 (APPELLANT) (RESPONDENT) PAN No. AMCPK8293P Assessee by: Sh. Sankalp Malik, Adv. Revenue by : Ms. Indu Bala Saini, Sr. DR Date of Hearing: 26.06.2025 Date of Pronouncement: 26.06.2025 ORDER This assessee’s appeal for Assessment Year 2017-18, arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2024-25/1069245133(1) dated 30.09.2024, in proceedings u/s 147 of the Income Tax Act, 1961 (in short “the Act”).

2.

Heard both the parties at length. Case file perused.

3.

A perusal of the case file indicates with the able assistance coming from both the parties that the learned lower authorities had assessed the assessee’s cash deposits of Rs.86,70,000/- as unexplained in assessment order dated 29.03.2022 which stands restricted to Rs.36,57,400/- only in the lower appellate discussion.

Sudhir Kumar 4. It is in this factual backdrop that the assessee now seeks to reverse the impugned addition to the tune of Rs.36,57,400/- only. That being the case and in light of the assessee’s vehement submissions that he is already engaged in “Arathiya” business. The Revenue could hardly dispute that possibility of cash receipts in such an organized sector could not be ruled out altogether. The fact also remains that it was the assessee’s bounden duty only to plead and prove all the credit entries by way of filing the corresponding reconciliation as well. Be that as it may, it is deemed appropriate in the larger interest of justice that a lump sum addition of Rs.3,50,000/- only would be just and proper with a rider that the same shall not be treated as a precedent. Necessary computation shall follow as per law.

5.

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.

6.

No other ground or argument has been pressed.

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