MANOJ KUMAR,HODAL vs. THE INCOME TAX OFFICER, WARD-1(3), FARIDABAD

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B”: NEW DELHI BEFORE MS MADHUMITA ROY, JUDICIAL MEMBER AND SHRI KRINWANT SAHAY, ACCOUNTANT MEMBER

ITA Nos. 9096/Del/2025 (A.Y 2017-18) Manoj Kumar Vs. The Income Tax Officer, Near Punhana Chowk, Ward-1(3) Opposite Government New CGO Complex, NH-4, College, Palwal, Haryana NIT, Faridabad (Appellant) (Respondent) PAN: CBIPK8179H

Assessee by : Sh. Gagan R Khandelwal, Adv and Shri Jaind Kumar Jaiswal, Adv Revenue by: Shri Mahendra Singh, Sr. DR

Date of Hearing 02/07/2026 Date of pronouncement 09/07/2026 O R D E R PER MADHUMITA ROY, J. M.: The instant appeal filed by the assessee is directed against the

order dated 07.08.2025 passed by the Ld. Commissioner of Income-

tax (Appeals), [hereinafter referred to as the Ld. CIT(A)]/National

Faceless Appeal Centre (‘Ld. CIT(A)/NFAC’ for short) under Section

250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’)

arising out of the Assessment Order dated 23.12.2019 passed by the

Assessment Unit, Income-tax Department (hereinafter referred to as

‘the ld. AO’) under Section 143(3) of the Act for Assessment Year

2017-18.

made by the assessee is a subject matter before us.

the tune of Rs. 57,74,800/- which was added in the hands of the

Assessee in the absence of any cogent evidence establishing the

source of such deposit made by the assessee. Before the Ld. CIT(A)

relevant requisite documents were duly filed by the assessee by way

of an application under Section 46A of the Act and such additional

documents were duly sent to the Ld. A.O. seeking remand report

whereupon the Ld. A.O. disproved the same as those documents,

though opportunitywas given to the assessee not furnished before

him. The remand report sent by the Ld. A.O. is reproduced at Page

No. 5 of the order of the Ld. CIT(A). According to the Ld. CIT(A), the

documents not correlating into external record.Further that, no cash

flow statements, patient admission register or sales register of the

pharmacy was filed. The source, therefore, is found to be mis-

conceived as of the opinion of the Ld. CIT(A) and finally the order

passed by the Ld. A.O. was upheld.

Mr. Gagan R Khandelwal, that addition under Section 69A of the Act,

in the facts and circumstances of the matter does not lie as the

provisions of Section 69A is only applicable in anyfinancial year

where as the assessee is found to be the owner of any money,

bullion, jewellery or valuable article, which is not recorded in the books of account, if any, maintained by him for any source of

income. No such incident as above is present in the case in hand

and, therefore, addition invoking the provision of Section 69A is not

applicable in the case in hand as further submitted by him. Such

case made out by the assessee has not been able to be further

controverted by the Ld. DR.

the cashbalance which could be considered as the source of cash

deposit of Rs. 57,74,800/-, this cash balance is nothing but the sale

of medicine and hospital receipts cannot be added in the hands of

the assessee by invoking the provision of Section 69A of the Act.

Therefore, there is no justification treating such cash sales as

unexplained cash credit under Section 69A of the Act. In this

regard, we have further considered the judgment passed by the Co-

ordinate Bench of the Tribunal in the case of Ajit Batra Vs. ITO in

ITA No. 3099/Del/2024, the books of accounts maintained by the

assessee as also produced before us, entries whereof relating to cash

deposits were also not considered its proper perspective as because

the explanation offered by the assessee towards sources of cash

deposit was not found to be satisfactory, thus addition under any

circumstances under Section 69A is not sustainable in the eyes of

law. Thus, having regard to the entire respect of the matter when the cash deposit has been made out of the cash sales recorded in the

books of account addition invoking the provision of Section 69A of

the Act is found to be bad in law and, therefore, quashed.

before us for AY 2017-18 as the provision of Section 115BBE of the

Act which enhanced the rate of tax, could be made applicable only

w.e.f. 01/04/2017. In this regard he has relied upon the judgment

passed by the Co-ordinate Bench of the Tribunal in ITA No.

4855/Del/2025 in the case of World Wide Textile Pvt. Ltd. Vs. ACIT

wherein on the identical issue addition under Section 115BBE of the

Act for A.Y 2017-18 was deleted relying upon the judgment passed

by the Hon’ble Madras High Court with the following observation:-

“6. Further, we also find that Hon'ble Madras High Court in the case of SMILE Microfinance Limited vs ACIT in WP (MD) No. 2078 of 2020 and WMP (MD) No. 1742 of 2020 dated 19-11-2024 had held that the provisions of section 115BBE of the Act which enhanced the rate of tax could be made applicable only from 01.04.2017, relevant to assessment year 2018-19 onwards and not earlier. Hence the additional ground raised by the assessee in this regard is hereby admitted and allowed.” 7. The Ld. DR could not controvert the submission made by the

Ld. AR, neither could rely upon any order contrary to the ratio laid

down by the Co-ordinate Bench as above. Thus, having heard the

Ld. Counsels appearing for the parties and having regard to the

entire facts and circumstances of the matter when admittedly the provision of Section 115BBE is made applicable w.e.f 01.04.2017 for

A.Y 2018-19, in the instant case, addition under Section 45BBE for

A.Y 2017-18 is found to be bad in law, not sustainable and

therefore, quashed.

Order pronounced in the open court on 09/07/2026.

Sd/- Sd/- (KRINWANT SAHAY) (MADHUMITA ROY) ACCOUNTANT MEMBER JUDICIAL MEMBER

Dated: 09/07/2026 R. Naheed, Sr PS Copy forwarded to