SHREE RAMRAJA HOMES PVT.LTD,JHANSI vs. DCIT,CIRCLE 2(1)(1), AGRA

(ASSESSMENT YEAR: 2017-18) DCIT, Shree Ramraja Homes Circle-2(1)(1), Pvt. Ltd., Vs. Sanjay Place, Agra. 7, Om Building, New Road, Jhansi, Uttar Pradesh- 284002 PAN-AAPCS3955G (Appellant) (Respondent) Assessee by Shri Utsav Sehgal, CA Department by Shri Shailendra Srivastava. Sr. DR Date of Hearing 22/05/2025 Date of Pronouncement 24/06/2025 O R D E R [ PER MANISH AGARWAL, AM: This appeal is filed by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC) Delhi [‘Ld. CIT(A) in short] dated 28.03.2024, in Appeal No. NFAC/2016-17/10165707 for Assessment Year 2017- 18 arising out of the order passed u/s 147 r.w.s 144 of the Income Tax Act, 1961 (the Act, inshort) dated 21.03.2022.

Shree Ramraja Homes Pvt. Ltd. vs. DCIT 4. Against such order, the assessee is in appeal before the Tribunal by taking following the grounds of appeal: “

1(a). That the learned Commissioner of Income-tax (Appeals), (hereinafter referred to as the 'CIT(A)'], NFAC, Income Tax Department has been arbitrary and unjust in passing order under section 250 of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') by upholding the assessment order passed by the Ld. ITO, NFAC, Income Tax (hereinafter referred to as the 'AO'] in complete denial to the written submissions made and material placed by the appellant before the Ld. CIT(A), (b). That the Ld. CIT(A) passed the impugned order without giving proper opportunity of being heard to the appellant and formed unilateral opinion without delving into the facts and circumstances present in the case of the appellant and has grossly erred in law as well and in facts of the case in committing apparent miscarriage of justice by causally adjudicating the case on the basis of hypothetical facts not pertaining to the appellant and thereby dismissing the appeal without any just & valid reasons,

2. That the order passed by the Ld. CIT(A) is bad in law and liable to be quashed as the assessment order passed by the Ld. AO was in violation and complete disregard to the Standard Operating Procedure (SOP) mandated by the CBDT from time to time in it circulars for verification of cash transactions relating to demonetization period and so the impugned demand of Rs. 44,91,320 is liable to be quashed.

3. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts by the upholding the impugned reassessment order passed by the Ld. AO since it was initiated and passed without complying with the mandatory conditions of section 147 to section 148A of the Act,

4. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts by the upholding the impugned reassessment order passed by the Ld. AO since no valid satisfaction/approval under section 151 of the Act was obtained, 5(1). That on the facts and circumstances of the case, the Ld. CIT(A) was not justified in upholding the addition of Rs. 34,00,000 made under section 69A of the Act without appreciating the submissions filed and facts prevalent in the case of the appellant, (ii) That there is a direct nexus between cash in hand, cash withdrawals from bank account and subsequent cash deposits therein, therefore the impugned addition made by the Ld. AO is arbitrary and without any basis, 6(1). That the Ld. CIT(A) has upheld the addition of Rs. 34,00,000 made under section 69A of the Act solely because of time gap between cash withdrawal from the bank account and subsequent deposit into the same during the impugned period without appreciating the fact that since the appellant being a company maintained books of account under the Companies Act 2013, neither any defect has been pointed in the cash book of the appellant nor such books of account have been rejected and therefore, the cash deposited into the bank account cannot be treated as unexplained money since it was duly recorded in the books of account maintained by the appellant, (ii) That the Ld. CIT(A) has upheld the addition of Rs. 34,00,000 made under section 69A of the Act r.w.s 115BBE of the Act without establishing if during the impugned period such cash in hand was utilized by the appellant for making any other investment or was exhausted towards incurring any expenditure or was utilized by the appellant for any other Shree Ramraja Homes Pvt. Ltd. vs. DCIT purpose, but the Ld CIT(A) summarily rejected the appellant's explanation despite the appellant giving proof that the cash withdrawn from the bank was available for redeposit, 7. That the Ld CIT(A) has erred in law and on facts in uploading the addition of Rs. 34,00,000 made under section 69A of the Act r.w.s 115BBE of the Act by vaguely applying the principle of human probability by unilaterally making assumptions and treating cash deposited into the bank as unexplained without any concrete evidence and the burden of proof lies with the revenue authorities to show that the cash in hand is unexplained especially when the source of cash is explained and recorded in the books of account of the appellant, 8.(a) That in any view of the case, charge of interest under sections 234A, 234B and 234C of the Act is unwarranted. (b) That further in any view of the case, the initiation of penalty proceedings u/s 271AAC and 272A(1)(d) of the Act is unwarranted.

9. That the appellate order dated 28.03.2024 passed by the Ld. CIT(A) is against the law and facts of the appellant's case. The appellant also seeks permission to modify and/or adduce any other ground/grounds of appeal

as circumstances of case might require or justify.”

5. Before us, the ld. AR of the assessee has not pressed the grounds of appeal No.1 to 4 taken against reopening of the assessment, thus the same are dismissed.

7. Before us, the Ld. AR of the assessee submitted that the assessee has made cash withdrawal from its bank account from time to time which are tabulated as page 4 of the order of Ld. CIT(A). The said cash was available with the assessee and was redeposited by the assessee in the bank account when the demonetization was Shree Ramraja Homes Pvt. Ltd. vs. DCIT announced. Ld. Ar further submitted that the Assessing Officer has not doubted the books of accounts maintained in the regular course nor the same were rejected. He further submitted that without bringing any contrary evidence on record to controvert the evidences filed by the assessee, the action of the lower authorities in holding the cash deposits as unexplained money deserves to be held bad in law and consequent additions deserves to be deleted. Regarding the application of provisions of section 115BBE, the ld. AR submitted that the said provisions was inserted from 1.4.2017 and thus applicable from AY 2018-19. He further placed reliance on the judgment of hon’ble Madra High Court in the case of S.M.I.L.E. Microfinance Pvt. Ltd. Vs. ACIT, in W.P. (MD) No. 2078 of 2020 & 1742 of 2020 dated 19.11.2024 (Mad.) wherein it has been held that that the law applies to the transaction on or after 01.04.2017 only. He prayed accordingly.

8. Per contra, the Ld. Sr. DR supported the orders of lower authorities and requested for the confirmation of the additions made.

Shree Ramraja Homes Pvt. Ltd. vs. DCIT 12. The ground of appeal no. 8 is regarding charging of interest u/s 234B which is consequential in nature and the AO is directed to charge interest as per law on the tax on the income computed after giving effect to this order.