LAL JI VERMA,FIROZABAD vs. INCOME TAX OFFICER WARD 2(2)(2), INCOME TAX OFFICE, FIROZABAD

Aforesaid appeal by assessee for Assessment Year (AY) 2017-18 arises out of the order of learned Commissioner of Income Tax, National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 13-05-2024 in the matter of an assessment framed by Ld. Assessing Officer [AO] on best judgment basis u/s. 144 of the Act on 06-11-2019. The registry has noted delay of 38 days in the appeal which stand condoned.

In the assessment order, Ld. AO noted that the assessee deposited cash of Rs.10.26 Lacs in its bank accounts during demonetization period. There were other credits of Rs.2.93 Lacs during remaining period. Both these amounts were added as unexplained money u/s 69A r.w.s.

During appellate proceedings, the assessee submitted that it was a small artisan and engaged in making / selling silver ornaments. The source of deposits was sales turnover and loan taken for Rs.8.16 Lacs from Aryavart Bank, Firozabad. The assessee’s submissions were subjected to remand proceedings wherein Ld. AO still rejected the claim of the assessee. It also transpired that the assessee filed return of income on 02-11-2018 after due date u/s 139 which was treated as invalid return for want of verification. The Ld. CIT(A), after due consideration, observed that the loan was obtained on 12-04-2016. Subsequently, the assessee withdrew Rs.8 Lacs during 12-04-2016 to 16-04-2016. The withdrawals were utilized in the jewellery job work business which could not be available for re-deposit during demonetization period. The assessee failed to furnish requisite documents to explain the source of deposit. Finally, the assessment was confirmed against which the assessee is in further appeal before us.