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Facts
The assessee deposited Rs. 13,47,000/- in various bank accounts during the demonetization period (November-December 2016). The Assessing Officer made an addition of Rs. 10,77,000/- under section 69A of the Income Tax Act as unexplained cash credit, after allowing for withdrawals of Rs. 2,70,000/-. The assessee contended the source was 'Stree Dhan', past savings, and cash in hand from her sons' marriages.
Held
The Tribunal partly allowed the appeal, recognizing that it is customary for ladies to hold Stree Dhan and have cash savings. Considering the assessee's consistent income disclosure and CBDT Circular No.3 of 2017, an additional Rs. 2,50,000/- (beyond the Rs. 2,70,000/- already allowed) was deleted from the addition. Thus, a total of Rs. 5,00,000/- was deleted, and the balance addition of Rs. 5,77,000/- was upheld.
Key Issues
Whether the addition of unexplained cash credit under Section 69A for cash deposits made during the demonetization period was justified, considering claims of Stree Dhan and past savings.
Sections Cited
69A
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Income Tax Appellate Tribunal, DELHI BENCH “SMC”, DELHI
Before: SHRI VIKAS AWASTHY
बनाम Vs. Income Tax Officer, Ward-67(2), ..... �ितवादी/Respondent Civic Centre, New Delhi 110002 अपीलाथ� �ारा/ Appellant by : None �ितवादी�ारा/Respondent by : Ms. Shivani Bansal , Sr. DR सुनवाई क� ितिथ/ Date of hearing : 11/09/2024 घोषणा क� ितिथ/ Date of pronouncement : : 29/11/2024 आदेश/ORDER
PER VIKAS AWASTHY, JM:
This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi (hereinafter referred to as 'the CIT(A)') dated 01.09.2023, for assessment year 2017-18.
The solitary issue in appeal by the assessee is against addition of Rs.10,77,000/- on account of unexplained cash credit u/s. 69A of the Income Tax Act, 1961(hereinafter referred to as 'the Act’), during the period of demonetization.
Facts of the case in brief as emanating from documents on records are: The assessee filed her return of income for the impugned assessment year on 26.07.2017 declaring income of Rs.9,08,150/-. The case of the assessee was selected for scrutiny under CASS to verify cash deposits during demonetization period. During the course of assessment proceedings the bank statements of the assessee were called for. The assessee furnished following bank statements and the cash deposits during demonetization period: Sr. No Name of the Bank Account No. Cash deposited during demonetization period i.e. 09.11.2016 to 31.12.2016 (in Rs.) 1 ICICI Bank, Jor Bagh 028601000468 140000 2 ICICI Bank, Greater Kailash 002901037155 376000 3 HDFC Bank, Kalkaji 15591020000238 245000 4 HDFC Bank, Jor Bagh 50100036551206 244000 5 HDFC Bank, Jor Bagh 50100068932065 146000 6 Bank of India 3857 196000 Total 13,47,000
To explain the source of deposit, she submitted that the cash was deposited out of her Stree Dhan and past savings, and her income for the past several years. She further pointed that the cash deposits also include withdrawals from her bank account in the past and deposited during demonetization period. To substantiate her income from preceding assessment years she furnished copies of ITR’s for the last six years. The Assessing Officer (AO) while completing the assessment gave benefit of Rs.2,70,000/- i.e. for the withdrawals made during Financial Year 2016-17 and made addition of remaining cash deposits i.e. Rs10,77,000/-. Against the Assessment Order dated 26.12.2019, the assessee filed appeal before the CIT(A), but remained unsuccessful. Hence, present appeal by the assessee.
Ms. Shivani Bansal, representing the department vehemently defended the impugned order and prayed for dismissing appeal of the assessee. She submitted that the assessee failed to substantiate source of cash deposits in her bank accounts during the demonetization period.
Submissions made by ld. DR heard and order of the authorities below examined. The solitary addition in dispute is addition of Rs.10,77,000/- on account of cash deposits in the bank account during demonetization period. The assessee during assessment proceedings explained that the cash was deposited out of Stree Dhan, savings from the past years, withdrawals from the bank and balance cash in hand from the marriages of her two sons solemnized on 14.02.2017 and 04.12.2017. The AO gave benefit of only cash withdrawals from the bank and did not consider the other explanations given by the assessee. The assessee in order to substantiate her contentions has placed on record ITR’s for the past six assessment years and the copies of marriage cards of her sons and their marriage registration certificate. The deposit of cash from past savings and Stree Dhan cannot be ignored. It is customary in the Indian society that the ladies hold Stree Dhan and have savings in the form of cash. The CBDT vide Circular No.3 of 2017 allowed cash deposits during demonetization without asking any question up to Rs.2,50,000/-. Further, the assessee in past has disclosed income in her return of income averaging Rs.7,17,806/-. Keeping in view the fact that the assessee was declaring annual income of Rs. 7,17,806/- in past assessment years, the assessee must be having some cash savings which was subsequently deposited in the bank during demonetization period. The benefit of such savings amounting to Rs.2,50,000/- is extended to the assessee. Thus, in aggregate an amount of Rs5,00,000/- is directed to be deleted. The balance addition of Rs.5,77,000/- is upheld.
In the result, appeal of the assessee is partly allowed. Order pronounced in the open court on Friday the 29th day of November, 2024.