AGRATA REAL ESTATE PRIVATE LIMITED,THANE WEST vs. ACIT, CC-2(2), MUMBAI, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY, JM Agarta Real Estate Private Limited A-02, Mahavir Darshan CHS Ltd., Shanti Park, Mahavir Darshan Bldg.-X- 31/32, Mira Road, East, Thane – 401107. Vs. ACIT, CC-2(3), Mumbai
Per Narender Kumar Choudhry, J M:
This appeal has been preferred by the assessee against the order dated
13.08.2025, impugned herein, passed by the Ld. Commissioner of Income Tax
(Appeals) 48, Mumbai (in short Ld. Commissioner) u/s 250 of the Income Tax Act,
1961 (in short ‘the Act’) for the A.Y. 2017-18. 2. In the instant case, the Assessee declared its total income at Rs. ‘Nil’ by filing its return of income on dated 17.03.2018, which was subsequently selected for limited scrutiny under CASS by issuing notice dated 09.08.2018, u/s. 143(2) of the Act, for the following issues:
a. Expenses incurred for earning exempt income.
b. Investments/Finance/Loans.
Agarta Real Estate Private Limited
The Assessing Officer (AO) thereafter issued another notice dated 19.02.2019, u/s. 142(1) of the Act, wherein the he asked for furnishing of explanation along with supporting evidence in addition to the aforesaid issues, qua one more issue, which read as under: “Abnormal in cash deposit during demonetization period as compared to pre demonetization period.”
The AO, thus vide assessment order dated 09.12.2019, u/s. 143(3) of the Act ultimately made the addition of Rs. 25,73,000/- on account of cash deposits made during demonetization period in the bank account maintained with Axis bank, as unexplained income/money u/s. 69A of the Act, as per 03rd issue raised vide notice dated 19.02.2019, u/s. 142(1) of the Act and added the said amount to the total income of the assessee taxing the same u/s. 115BBE of the Act.
Admittedly, the case of the assessee was selected for limited scrutiny for two issues such as ‘firstly’ expenses incurred for earning exempt income and ‘secondly’ investments/advances/loans but not for the 3rd issue qua abnormal increase in cash deposit during demonetization period, as compared to pre demonetization period, which resulted into making the addition without converting the case into full scrutiny and/or without taking approval of the Appropriate Authority, as required as per CBDT instruction no. 20/2015. Thus, the addition made by the AO and affirmed by the Ld. Commissioner, is liable to be deleted. Resultantly, the same is deleted.
In the result, the appeal filed by the assessee is allowed. Order pronounced in the open court on 27.11.2025 (NARENDER KUMAR CHOUDHRY)
JUDICIAL MEMBER
Mumbai; Dated:
.11.2025
Karishma J. Pawar, SR. PS
Agarta Real Estate Private Limited
Copy of the Order forwarded to:
The Appellant 2. The Respondent 3. CIT- concerned 4. DR, ITAT, Mumbai 5. Guard File BY ORDER,
(Dy./Asstt.