MOMIN GUJARAT CHS LTD,MUMBAI vs. ITO WARD NO 31(2)(3), MUMBAI

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ITA 2888/MUM/2024Status: DisposedITAT Mumbai23 August 2024AY 2017-2018Bench: SHRI ANIKESH BANERJEE, JUDICIAL MEMBERAND SHRI GAGAN GOYAL (Accountant Member)1 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal noted that the cash deposited was collected before the demonetization period and was duly deposited in the bank. The ledger copies and bank statements supported the assessee's claim. The Tribunal found that the CIT(A) had not properly considered the assessee's submission.

What were the facts?

The assessee, a co-operative housing society, deposited Rs. 21,85,736 in its bank accounts during the demonetization period, claiming it was collected from members as maintenance charges. The Assessing Officer added this amount under section 69A and taxed it under section 115BBE. The CIT(A) confirmed the assessment order.

What were the issues?

Whether the cash deposit made during the demonetization period, claimed to be maintenance collection, is explainable and therefore not liable to be added to the income of the assessee.

Which sections of the Income-tax Act were involved?

Section 69A,Section 115BBE,Section 250,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “H(SMC

Before: SHRI ANIKESH BANERJEEAND SHRI GAGAN GOYAL

For Appellant: Shri Vimal Punmiya
For Respondent: Shri Mehul Jain (Sr. DR)
Hearing: 22/08/2024

Instant appeal of the assessee was filed against the order of theLearned National Faceless Appeal Centre (NFAC), Delhi [for brevity, ‘Ld.CIT(A)’] passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’), for Assessment Year 2017-18, date of order 31.03.2024. The impugned order was emanated from the order of the Ld. Income-tax Officer, Ward 31(2)(3), Mumbai, order passed under section 143(3), date of order 05/12/2019.

1) That the learned Assessing officer erred in facts and at law in adding the entire deposit of cash of Rs.21.85.736 and thereby enhancing the income of the appellant to that extent. 2) The learned Assessing officer erred in recognising the fact that the society which has almost 800 and odd members cannot have balance of the sum of money added by him 3) That the learned assessing officer erred in not providing proper opportunity of being heard to the appellant 4) The learned assessing officer erred in levying interest and penalties under various sections of Income Tax Act. 5) That your appellant craves leave to add alter delete, amend any of the groundsof appeal.

3.

The brief facts of the case are that the assessee is a co-operative housing society and filing the return of income under the status of ‘Body of Individuals’ (BOI). In the impugned assessment year, the assessee deposited cash during the demonetization period, SBN amount of Rs.21,85,736/- in it’s different bank accounts. The deposited cash was from collection of maintenance from the members of the society and the assessee is maintaining 12 housing units. Each housing unit maintainsa separate bank account.The cash was deposited in bank accounts in SBN during the demonetization period amount to Rs. 21,85,736/- as per the ld. AO. The amount of Rs.21,85,736/- was added under section 69A and taxed under section 115BBE of the Act. Being aggrieved on the assessment order, the assessee filed an appeal before the ld. CIT(A). The assessee claimed before the ld. CIT(A) that the Ld.AO had wrongly determined the cash deposit amount ofrs.21,85,736/- instead of Rs.18,96,736/-. The Ld.CIT(A) had not considered the Momin Gujarat CHS Ltd assessee’s submission. The appeal order was passed by confirming the assessment order. Being aggrieved on the appeal order, the assessee filed an appeal before us.

4.

The Ld.AR filed the written submission which is kept in record (in short APB). The Ld.AR argued that the assessee collected the cash before the demonetization period; the cash was deposited in SBN within the period from 08/11/2016 to 31/12/2016. It was allowed that the SBN can be deposited in their bank and passed office accounts from 08/11/2016 till 30/12/2016. The Ld.AR first agitated that the Ld.AO has wrongly determined the deposit of cash in bank account during said period. The correct amount is Rs.18,96,736/- which is deposited in its different bank accounts. The details list of the deposit of cash in banks account is reproduced as below: -

The assessee has deposited cash of Rs.18,96,746/- between 9th “B. November, 2016 to 31st December,2016 in bank post demonetization i.e. Saraswat Bank as per table below: - Sr.No. Bank Account Nos. Amount (Rs.) 1 5057201005050263 76,636/- 2 50572010051810 1,86,860/- 3 50572010055764 3,01,966/- 4 50572010091044 4,00,000/- 5 50572010094257 1,41,582/- 6 5057201010703 4,11,406/- 7 50572010046909 3,78,286/- TOTAL 18,96,736/- Momin Gujarat CHS Ltd The Ld.AR in argument placed the yearwise bank deposits. The ld. AR explained that every year the deposit of cash in bank accounts are in same frequency. There no such certain hike in the impugned assessment year. The chart related to comparative study is reproduced as below: -

“7. The total sales and cash deposits summary bank account wise from previous years maintenance receipts. Bank Accounts FY 2014-15 FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19 Ay 2015-16 AY 2016-17 AY 2017-18 AY 2018-19 AY 2019-20 5057201005050263 4,16,385 4,94,502 4,14,346 4,53,714 4,49,115 50572010051810 8,39,141 9,18,498 10,61,108 8,58,116 8,49,595 50572010055764 19,49,683 19,35,356 19,44,453 17,29,072 19,52,310 50572010091044 6,00,000 6,00,000 8,00,000 5,00,000 17,40,500 50572010094257 5,00,477 9,27,314 8,44,162 7,09,533 6,78,197 5057201010703 14,79,810 14,98,635 15,30,329 15,74,524 14,11,866 50572010046909 134,42,354 18,48,243 13,54,881 15,42,556 17,33,230 Total 71,27,850 82,22,548 79,49,379 73,67,515 88,14,813 The Ld.AR has drawn our attention in the APB pages 33 to 308 where the ledger of accounts for collection on maintenance and the bank account statement are annexed as a proof that the collection was made during this impugned assessment year and the balance is reflected on 07/11/2016 which was deposited in the bank within the said period. Further, the list of members APB pages 23 to 32 is annexed as proof of collection of maintenance.

5.

The Ld.DR vehemently argued and fully relied on the order of revenue authorities. The Ld.DR placed that during the assessment stage, the assessee was unable to submit the proper documents before the authority.

6.

We heard the rival submission and considered the documents available in the record. The assessee is a co-operative society and maintaining 12 housing Momin Gujarat CHS Ltd society. Every housing society maintains a separate bank account. The cash collected in SBN till dated 07/11/2016 was duly deposited in the bank. The relevant ledger copy of bank account and the details of collection statements are enclosed. The Ld.DR did not make any objection to the submission of the Ld.AR. The fact was revealed that the Ld.CIT(A) has not considered the submission of the assessee only to uphold the assessment order. The impugned deposit in SBN during the demonetization is explainable cash deposit, which are collected from the members of the society and the balance stood on dated 07/11/2016. We set aside the appeal order. The cash deposited in the bank account during said period was the balance on dated 07/11/206. Accordingly, the addition amount to Rs.21,85,736/- is quashed.

7.

In the result, the appeal of the assessee bearing is allowed.

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