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Facts
The assessee's income tax assessment for AY 2017-18 resulted in an addition of Rs. 4,83,500/- for cash deposits in Specified Bank Notes during the demonetization period, which was confirmed by the CIT(A). The assessee filed an appeal before the ITAT with a delay of 112 days, citing medical reasons.
Held
The Tribunal condoned the delay in filing the appeal due to the assessee's medical condition. On merits, it held that the assessee had substantial prior cash withdrawals of Rs. 17,42,000/- during the period 13.04.2016 to 28.09.2016, which were available as a source for the subsequent cash deposits. Consequently, the addition of Rs. 4,83,500/- made by the lower authorities was set aside, and the AO was directed to delete it.
Key Issues
Whether the delay in filing the appeal should be condoned and whether the addition of cash deposits during the demonetization period, explained by prior cash withdrawals, was justified.
Sections Cited
143(3)
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Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM
O R D E R This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 11.07.2024 for Assessment Year (AY) 2017-18.
Brief facts of the case are that the appellant is an individual deriving income from pension. The return of income for AY 2017-18 was filed on 26.03.2018 declaring income of Rs. 2,84,670/- Against the said return of income, the assessment was completed by the Income Tax Officer, Non-corporate Ward-2(1), Kochi (hereinafter called "the AO") vide order dated 29.12.2019 passed u/s. 143(3) of the Income Tax Act, 1961 (the Act) at a total income of Rs. ,7,68,170/-. While doing so, the Norbet Deilip Elavunkalpeter AO made addition of cash deposit in Specified Bank Notes (SBN) during the demonetisation period of Rs. 4,83,500/- rejecting the explanation of the appellant that the amount of Rs. 3,00,000/- was received from two people, namely Alphonsa Norbet and Aleena Norbet.
Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order confirmed the action of the AO.
Being aggrieved, the appellant is in appeal before the Tribunal in the present appeal.
I find that there is a delay in filing the present appeal by 112 days. The appellant had filed application seeking condonation of delay on the ground that the delay had occurred on account of medical reasons. It is stated that the appellant was suffering from reduction in platelet count as a result of which he had suffered severe weakness and compounding to that he was bitten by a dog and undergoing series of anti-rabies vaccine injections from 17.07.2024 to 14.08.2024. In support of this he had also filed medical certificate.
On the other hand, the learned Sr. DR not disputed the averments made in the petition. In the absence of any evidence to the contrary, I am of the considered opinion that it is a fit case to condone the delay. Accordingly, the delay is condoned and admit the appeal for adjudication on merits.
When the appeal was called on, nobody appeared on behalf of the assessee despite due service of notice of hearing. Therefore, I proceeded to dispose of the appeal after hearing the learned Sr. DR. Norbet Deilip Elavunkalpeter 8. The short issue that arises for my consideration is whether the CIT(A) is justified in holding that the appellant had not offered any explanation with regard to the source of cash deposits made in SBN during demonetisation period. From a mere reading of para 5.13 of the order of the CIT(A) it is clear that the appellant had withdrawn a sum of Rs. 17,42,000/- during the period commencing from 13.04.2016 to 28.09.2016. There is no evidence that these withdrawals were used for any other purpose. Therefore, the amount withdrawn earlier should be treated available for subsequent deposit. Therefore, the lower authorities were not justified in making addition of Rs. 4,83,500/- as unexplained money of the assessee. Accordingly the orders of the lower authorities are hereby set aside and direct the AO to delete the addition.
In the result, the appeal filed by the assessee stands allowed.
Order pronounced in the open court on 25th March, 2025. 10.