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Facts
The assessee challenged an addition of Rs. 13,68,500/- made by the Assessing Officer (AO) for cash deposits in HDFC Bank and ICICI Bank, which was confirmed by the CIT(A). The assessee contended that these amounts were disclosed in the return of income, the books of accounts were not rejected by the AO, and the AO failed to consider the cash on hand available in old denominations.
Held
The Tribunal held that the addition made by the AO was unsustainable because the assessee had duly accounted for the cash deposits and the AO had neither rejected the assessee's books of accounts nor considered the cash on hand available in old denominations. Consequently, the Tribunal deleted the addition under consideration.
Key Issues
Whether the addition of cash deposits made by the AO is sustainable when the assessee's books of accounts were not rejected and the available cash on hand was not considered.
Sections Cited
250
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Income Tax Appellate Tribunal, NAGPUR “SMC” BENCH :: NAGPUR
Before: SHRI NARENDER KUMAR CHOUDHRY
This appeal has been preferred by the Assessee against the order dated 21/10/2023 impugned herein passed by the National Faceless Appeal Centre (NFAC)/Commissioner of Income Tax (Appeals), Delhi (in short, ‘Ld. Commissioner’) u/sec. 250 of the Income Tax Act, 1961 (in short, ‘Act’) for the A.Y. 2017-18.
(Bhaskar Ramchandra Nikhade) 2. In the instant case, the Assessee has claimed that by filing its return of income, he had disclosed cash deposited in bank accounts which were duly recorded unaccounted for and the accounts of the Assessee have also been accepted, but still the Assessing Officer (AO) made the addition of Rs. 13,68,500/- deposited by the Assessee in his bank accounts maintained with HDFC Bank & ICICI Bank to the tune of Rs. 9,33,500/- & 4,35,000/- respectively. Admittedly, the Ld. Ld. AO has not rejected the books of accounts of the Assessee, therefore, addition made by the Ld. AO as confirmed by the Ld. Commissioner is unsustainable.
On the contrary, learned Departmental Representative (DR) refuted the claim of the Assessee.
This Court has given thoughtful consideration to the peculiar facts and circumstances and rival contentions of the parties. Admittedly, as observed above, the Assessee has duly accounted for the amounts deposited in the respective bank accounts and Ld.AO neither rejected the books of accounts nor considered the cash on hand as shown by the Assessee to the tune of Rs.13,68,500/- as on 08/02/2016 in old denomination of Rs. 500/- & 1,000/- notes, as it appears from the financial statements of the Assessee specifically at page No.161 of the paper book.
(Bhaskar Ramchandra Nikhade) 5. Considering the aforesaid facts and circumstances in totality, this Court is inclined to delete the addition under consideration, thus the same is deleted.
In the result, Assessee’s appeal is allowed.
Order pronounced in open court on 23.09.2025 as per Rule 34(5) of the Income Tax (Appellate Tribunal) Rules, 1963.