Loading judgment…
Facts
The assessee, a potato dealer, made cash deposits of Rs. 17,50,000 (part of total Rs. 25,50,000) in their bank account. The Assessing Officer and CIT(A) treated this as unexplained money under Section 69A, as the assessee failed to provide a loan certificate for claimed repayment to RBL Bank.
Held
The Tribunal noted that the assessee consistently conducted business in cash as a potato dealer. It found that the revenue authorities failed to verify the bank statements, which could have substantiated the assessee's claim regarding the source of cash. The Tribunal concluded that no addition was warranted.
Key Issues
1. Whether the cash deposits made by a potato dealer in their bank account can be treated as unexplained money under Section 69A of the Income Tax Act. 2. Whether the special rate of tax under Section 115BBE is applicable for Assessment Year 2017-18.
Sections Cited
69A, 115BBE
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD
O R D E R PER DR. B.R.R. KUMAR, VICE-PRESIDENT:-
Delay Condoned This appeal is filed by the Assessee against the appellate order dated 15.07.2024 passed by the Commissioner of Income Tax (Appeals)National Faceless Appeal Centre, Delhi, relating to the Assessment Year 2017-18.
Ld.CIT(A) erred in law and on facts in confirming addition of Rs.25,50,000/- made u/s.69A of the Act being allege unexplained money without appreciating facts and law of the case properly.
Without prejudice to above, Ld .Assessing Officer erred in law and facts in taxing the income at special rate mentioned in Section 115BBE of the Act without appreciating that amendment made in Section 115BBE will be applicable from AY 2018-19 onwards and not applicable for AY 2017-18 which is assessment year under question.
The appellant craves leave to add, amend or alter the grounds of appeal at the time of hearing if need arise.
4. The Assessing Officer observed that assessee had total deposits of Rs.25,50,000/- which includes cash deposit of Rs.17,50,000/- deposited in the bank account. The Ld. CIT (A) held that though the assessee had submitted that the amount was deposited to repay the loan taken from RBL Bank, the appellant has not furnished any loan certificate to substantiate this claim. Before us, it was submitted that the assessee is a potato dealer and has been doing the business in cash over the years. The cash deposits are consistent pattern in the business of the assessee during the year and the earlier years. The alleged repayment of loan could have been simply verified by the Ld.CIT (A) by examining the bank statement, for which the revenue authorities failed to do, thus digressing the issue of cash deposits and the source of cash thereon. On the point of cash deposits it was submitted that the assessee has been engaged in the sale of agricultural produce (potatoes). This fact is not disputed by the revenue authorities. Hence, keeping in view the specific facts of the case and the bank statement filed by the assessee, we hold that no addition is warranted.
In the result, the appeal of the assessee is allowed.
The order is pronounced in the open Court on 26.08.2025.
Sd/- Sd/-/- (SIDDHARTHA NAUTIYAL) (DR. B.R.R. KUMAR) JUDICIAL MEMBER VICE-PRESIDENT (True Copy) Ahmedabad; Dated 26.08.2025 MV आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant ��थ� / The Respondent. 2. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु�(अपील) / The CIT(A)- 5. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER, True Copy