KIRANBHAI RAMANBHAI PATEL,NADIAD vs. THE ITO, ANAND CIRCLE, ANAND

This is an appeal filed against the order dated 13-05- 2024 passed by National Faceless Appeal Centre (NFAC), Delhi for assessment year 2017-18.

The grounds of appeal

Both lower authorities failed to bring on record any evidence that appellant expended cash withdrawn from bank and accordingly there is no case for addition.

Charging of Interest u/s 234A,234B,234C & 234D are unjustified.

The assessee filed return of income for assessment year 2017-18 on 24-07-2017 declaring total income of Rs. 1,49,52,380/-. The assessee filed revised return of income on 05-01-2019 declaring total income at Rs. 1,49,52,380/- after claiming deduction of Rs. 2,05,484/- under Chapter VI-A of the Act. The case was selected for security under CASS to examine cash deposit during demonetization period. The statutory notices were issued to the assessee. The assessee has shown income from salary of Rs. 20,37,600/-, income from house property at Rs. 87,47,350/-, income from share in profit and loss of firms of Rs. 36,42,695/-, income from other sources under the head income from interest of Rs. 6,09,940/-, income from STCG of Rs. 47,774/- and other income of Rs. 19,245/-. In response to the statutory notices, the assessee filed various details. During the course of assessment proceedings, the Assessing Officer observed that the assessee made deposits Kiranbhai Ramanbai Patel, A.Y. 2017-18 of Rs. 10,94,500/-with Bank of Baroda during demonetization period which was withdrawn by the assessee from the same bank account from 07-04-2016 to 05-11-2016. After taking cognizance of the assessee’s reply, the Assessing Officer made addition of Rs. 10,94,500/- as unexplained money u/s. 69A r.w.s. 115BBE of the Act by treating it to be assessee’s deemed income.

The Ld. A.R. submitted that the assessee had deposited the SBN cash out of the cash withdrawn by the assessee between the 01-04-2016 and 05-11-2016 for various household expenses and has also given the details as to how the sale amount has been spent. The assessee has also shown closing amount at hand balance as on 31- 03-2017. The ld. A.R. submitted that the amount withdrawn amount is commensurate with the income offered. Thus, the A.R. submitted that the Assessing Officer as well as CIT(A) has not taken cognizance of the assessee’s evidences and submissions.

We have heard both the parties and perused the materials available on record. It is pertinent to note from Kiranbhai Ramanbai Patel, A.Y. 2017-18 the bank account statement as well as from the details filed by the assessee, are related to withdrawals from the bank account for the period 01-04-2016 to 05-11-2016 and the same is also mentioned in the assessment order. In fact, the closing cash at hand balance was also mentioned by the assessee and has not been questioned by the Assessing Officer which is 5.75 lakhs. Thus, the assessee has given the explanation related to the cash deposits including the sources of cash. Hence, the addition made by the Assessing Officer and confirmed by CIT(A) is not justified. The appeal of the assessee is allowed.

In the result, the appeal of the assessee is allowed.