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Facts
The assessee preferred an appeal against the order of the CIT(Appeals) upholding additions made by the Assessing Officer on account of cash deposited during the demonetization period and provisions made in the balance sheet.
Held
The Tribunal held that while the assessee may have violated the demonetization circular, it was not a case of unexplained income as the source of deposits was not doubted. The addition pertaining to provisions was also not pressed by the assessee.
Key Issues
Whether the addition on account of cash deposits during demonetization is to be treated as unexplained income when the source is not doubted by the authorities?
Sections Cited
250, 596
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Income Tax Appellate Tribunal, CHANDIGARH
Before: SH. SANJAY GARG
आदेश/ORDER
The present appeal has been preferred by the assessee against the order dated 31.03.2025 of the Commissioner of Income Tax (Appeals) Addl./JCIT(A)-2, Gurgaon [in short ‘the CIT (Appeals)] pertaining to 2017-18 assessment year.
ITA 579/CHD/2025 A.Y. 2017-18 2
The assessee in this appeal has taken the following grounds of appeal :
1. That order passed it's 250 of the Income Tax Act, S96I by (he Learned Addl. Commissioner of Income Tax ( Appeals )-2, Gurugram is against law and facts on the file in as much as Learned CIT(Appeal) was not justified to uphold the addition of Rs. 12,00.000'- made by the Learned Assessing Officer on account of cash deposited during demonetization period.
2. That the Learned CIT(A) gravely cited in upholding the addition of Rs. 4,14,248/- made by the Learned Assessing Officer which actually pertains to provisions made in the balance sheet.
3. At the outset, the ld. counsel for the assessee has stated at bar that he does not press ground No.2 of appeal, therefore, ground No.2 of the appeal is dismissed as not pressed.
4. So far as the addition made by the lower authorities of Rs.12 lacs on account of amount received by the assessee from its members is concerned, the receipt of the amount from members has not been doubted by the Assessing Officer. The only allegation is that the amount was received on 15.11.2016 i.e. during demonetization period. The assessee may have violated the Circular/Notification issued by the Government by accepting the demonetized currency but it is not a case of unexplained income of the assessee. The source of the deposits has not been doubted by the lower authorities, therefore the impugned addition is not ITA 579/CHD/2025 A.Y. 2017-18 3 sustainable and the same is, accordingly, ordered to be deleted.
In the result, appeal of the assessee is partly allowed.