AZAD HIND RICE MILL,BURDWAN vs. I.T.O., WARD-1(1), BURDWAN, BURDWAN

आयकर अपील�य अ�धकरण, पीठ “C-SMC” , कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL BENCH “C-SMC”KOLKATA Before: Shri Manish Borad, Hon’ble Accountant Member आयकर अपील सं.य/ Assessment Year: 2017-18 बनाम Azadhind Rice Mill I.T.O., Ward 1(1), Burdwan NA Krishnapur Kukura V/s. Saranga Khanda Ghosh Burdwan-713423 PAN: AAWFA5464E अपीलाथ� /Appellant ��यथ� /Respondent .. अपीलाथ� क� ओर से/By Appellant Shri S.K Mukherjee, Advocate, ld.AR ��यथ� क� ओर से/By Respondent Shri Vijay Kumar, Addl.CIT/Ld.DR सुनवाई क� तार�ख/Date of Hearing 12-12-2022 घोषणा क� तार�ख/ 15-12-2022 Date of Pronouncement आदेश /O R D E R

The instant appeal of the assessee for the assessment year 2017- 18 is directed against the order dt. 11-12-2021 passed u/s. 250 of the Income-tax Act, 1961 [ hereinafter, referred to as ‘the Act’] by the ld. Commissioner of Income-tax, Appeals [ in short, hereafter referred to as ‘the ‘ld. CIT(A) (National Faceless Appeal Centre), Delhi

3. The only grievance of the assessee is against the addition of Rs. 10 lakhs confirmed by the ld. CIT(A).

4. The brief facts of the case are that the assessee is a partnership firm engaged in the business of rice mill. Income of Rs.7,00,300/- declared in the return filed on 18-10-2017. Case was selected for scrutiny through CASS for complete Scrutiny for the reason of ‘cash deposit during demonetisation period’. Valid notices u/s. 143(2)/ 142(1) of the Act were served upon the assessee. The ld. AO during the course of assessment proceeding asked the assessee to explain the source of cash deposit of Rs.27,50,000/- during the period 09.11.2016 to 31.12.2016. The assessee filed complete details. However, the ld. AO was not satisfied with regard to the cash deposit of Rs. 10 lakhs and accepted the assessee’s contention explaining the balance of Rs. 17,50,000/-. The ld. AO accordingly made the addition of Rs.10,00,000/- u/s. 68 of the Act along with other minor addition of Rs. 7,914/- and assessed the assessee’s income at Rs.17,08,214/-. 5. Aggrieved, the assessee preferred appeal before the ld. CIT(A) and partly succeeded. As regards the addition of Rs. 10 lakhs made u/s. 68 of the Act ld.CIT(A) confirmed this addition observing that the assessee has not produced documentary evidences in support of cash deposits made into the bank account during the demonetisation period. 6. Aggrieved, the assessee is now in appeal before this Tribunal. 7. The Ld. Counsel for the assessee referring to paper book, audited balance sheet and some portions of cash book stated that the assessee made regular withdrawals of cash from bank for purchase of paddy from the farmers and some portion of sales are also made in cash. The alleged sum is duly explained with the help of cash book. Therefore, no addition was called for. 2. AY 2017-18 Azadhind Rice Mill

8. Per contra, the Ld. Departmental Representative vehemently argued supporting the orders of the lower authorities and also stated that the assessee has kept changing its submissions explaining the alleged cash deposit. During the assessment proceedings it was claimed that the cash has withdrawn from bank prior to said deposit and thereafter before the ld. CIT(A) source of cash deposit was from sales and cash in hand.

9. I have heard the rival contentions and perused records placed before me. Assessee’s sole grievance is regarding the addition u/s. 68 of the Act confirmed by ld. CIT(A) for not explaining the source of cash deposit during the demonetisation period. I observe that during the assessment proceedings ld. AO asked the assessee to explain the source of cash of Rs.27.50 deposited in bank lakhs during the periods 09.11.2016 to 31.12.2016. The ld. AO was satisfied with the source of cash deposit of Rs. 17.50 lakhs and for the remaining amount of Rs. 10 lakhs the addition has been made. 10. I on perusal of the paper book containing abstract of cash book for the 07-11-2016 to 16-11-2017 notice that as on 07-01-2016 the opening cash in hand with the assessee was Rs.61,90,148/-. Thereafter, on 08-11- 2016 various payments have been made in cash to sundry creditors and thereafter, during 11-11-2016 to 18-11-2016 cash amount of Rs. 27.50 lakhs was deposited in the bank. Part of the said sum of Rs. 17.50 lakhs has already been accepted by the ld. AO as explained. Remaining sum of Rs. 10 lakhs has also been deposited in the bank out of cash in hand available with the assessee. When the ld. AO has accepted the said cash book and part of cash deposited in the bank account out of the cash available in the cash book maintained by the assessee and books of account have not been rejected, then in such circumstances I fail to find any justification at the end of the revenue authorities of not accepting the 3. AY 2017-18 Azadhind Rice Mill source of alleged cash sum, which is out of the cash in hand available with the assessee. It is also worth noting that even on 30-11-2016 and 31- 12-2016 cash in hand available with the assessee is at Rs. 29,15,918/- and Rs.31.81,449/- respectively. Therefore, under the given facts and circumstances, I am of the considered view that since the assessee has successfully/satisfactorily explained the source of sum of Rs. 10 lakhs, I fail to find any justification in the addition being made u/s. 68 of the Act. I, therefore, reverse the findings of the ld. CIT(A) and delete the addition of Rs. 10 lakhs made u/s. 68 of the Act. All the grounds raised by the assessee are allowed.