Loading judgment…
Facts
The assessee, VVAD Hospitality Pvt. Ltd., operating a hospitality business, made cash deposits during the demonetization period. The lower authorities made an unexplained cash credit addition of Rs. 30.50 lakh under sections 68 and 115BBE, as the assessee failed to prove the source of these deposits during scrutiny. The appeal was heard ex parte.
Held
Considering the assessee's restaurant business where cash receipts are possible, the Tribunal reduced the addition to a lump sum of Rs. 10,00,000/-, thereby providing relief of Rs. 20.50 lakh from the original addition. This estimation is not to be considered a precedent for other cases.
Key Issues
Whether the addition of Rs. 30.50 lakh as unexplained cash credit under sections 68 and 115BBE was justified, given the assessee's business nature and cash deposits during demonetization.
Sections Cited
250, 68, 115BBE
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “SMC”: NEW DELHI
Before: SHRI SATBEER SINGH GODARA
order no. ITBA/NFAC/S/250/2024-25/1064423863(1), dated 29.04.2024, passed by the learned CIT(A)/National Faceless Appeal Centre (NFAC), Delhi, in appeal no. CIT(A), Delhi-9/10336/2019-20, in proceedings u/s 250 of the Income-tax Act, 1961. Case called twice. None appears at the assessee’s behest. It is 1961.
Learned DR vehemently submits during the course of hearing that both the lower authorities have rightly made section 68 read with section 115BBE unexplained cash credit addition of Rs. 30.50 lakh on account of the fact that taxpayer herein had made cash deposits during the demonetization period followed by its failure to prove source thereof during the course of scrutiny.
It is noticed in this factual backdrop that the assessee herein is a company engaged in hospitality business as per the assessment discussion itself at para 6 page 10 of the assessment order dated 28.12.2019. I duly invited the Revenue’s attention to the assessment findings, wherein it stands proved that this assessee has been running restaurant business and other allied activities wherein possibility of cash receipts could not be altogether ruled out. The fact also remains that it was bounden duty of the assessee only to plea and prove all the relevant facts by filing its cogent and supportive evidence. It is deemed appropriate in these peculiar facts and circumstances that a lump sum addition of Rs. 10,00,000/- (Ten Lakhs) only would be just and proper with a rider that instant estimation shall not be treated as a precedent in any other case or assessment year, as the case may be. The assessee
per law.
This assessee’s appeal is partly allowed.
Order pronounced in open court on 14.11.2024.