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Facts
The assessee's appeal for AY 2017-18 arose from assessment proceedings under Section 143(3). The assessee's cash deposits of Rs.21,34,042 during demonetization were assessed as unexplained. The assessee claimed these deposits as cash sales, which was not entirely ruled out.
Held
The Tribunal held that while the assessee's returned income from regular business was accepted, the impugned cash deposits could be assessed as business turnover at a profit element of 10%. However, this decision was not to be treated as a precedent. The applicability of Section 115BBE was restricted to transactions after 01.04.2017.
Key Issues
Whether cash deposits during demonetization, claimed as sales, could be treated as unexplained income or business turnover? Applicability of Section 115BBE to transactions prior to 01.04.2017.
Sections Cited
143(3), 68, 115BBE
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 Rakesh Vijay, Vs Income Tax Officer, 6492-93, Anoop Plywoods, Gali No. Ward-51(2), 4, Block-8, Dev Nagar, Karol Bagh, New Delhi-110002 New Delhi-110005 (APPELLANT) (RESPONDENT) PAN No. AANPK1645C Assessee by: None Revenue by : Sh. Manoj Kumar, Sr. DR Date of Hearing: 29.05.2025 Date of Pronouncement: 29.05.2025 ORDER
This assessee’s appeal for Assessment Year 2017-18, arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2024-25/1066412355(1) dated 04.07.2024, in proceedings u/s 143(3) of the Income Tax Act, 1961 (in short “the Act”).
Case called twice. None appears at the assessee’s behest. He is accordingly proceeded ex-parte.
Learned departmental representative vehemently argues during the course of hearing that both the learned authorities have rightly assessed the assessee’s cash deposits during demonetization amounting to Rs.21,34,042/- as unexplained u/s 68 r.w.s. 115BBE of the Act, in assessment framed on Rakesh Vijay 26.12.2019 and upheld in the lower appellate discussion. That being the case, a perusal of the case record indicates that both the learned authorities have already accepted the assessee’s returned income in regular business activities of Rs.12,05,570/- as per the assessment order. He had claimed the impugned cash deposits as representing cash sales during demonetization which could not be altogether ruled out in such a situation. It is therefore deemed appropriate in the larger interest of justice to assess the assessee’s impugned cash deposits of Rs.21,34,042/- as regular business turnover qua it’s profit element (supra) @ 10% only subject to a rider that the same shall not be treated as a precedent. Ordered accordingly.
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. 1742 of 2020 held that the said provision applied for transactions done on or after 01.04.2017 only.
This assessee’s appeal is partly allowed. Order Pronounced in the Open Court on 29/05/2025.