CENTRE FOR EDUCARE AND RESEARCH CHARITABLE TRUST,THIRUVALLUR vs. ACIT,CIRCLE-1,, NAGERCOIL

Aggrieved, assessee preferred an appeal before the ld. CIT(A). Ld. CIT(A) confirmed the action of the ld. Assessing Officer. Aggrieved, assessee is in further appeal before the Tribunal.

Before us, the ld. Authorized Representative contended that the Assessing Officer has made an addition of Rs.41,16,520/- being the cash deposits made during the demonetization period maintained by Mulagumoodu Branch solely on the ground that the appellant could not bifurcate the deposits made in SBNs and non SBNs in the said branch. The appellant had obtained the said certificate from the bank, Mulagumoodu Branch, showing the breakup of the deposits in SBNs and non SBNs. The above fact of deposit of SBNs only to the extent of Rs. 6,66,500/- at Mulagumoodu Branch was also confirmed by the Assessing Officer in the remand report dated 07.03.2024. Further, the assessee had also established during the remand proceedings that the closing cash balance as on 08.11.2016 was at Rs. 17,82,947/-. In fact, the total deposits made in SBNs in both the branches was only to the tune of Rs.16,92,000/- thereby establishing the source for such deposits emanating from the fees collected prior to 08.11.2016. Moreover, the appellant had also established the consistent cash deposits made in all the months including the demonetization period, thereby negating the presumption of any abnormality. The authorities below neither tampered with the any other deposits made during the assessment year under consideration nor rejected the books of accounts maintained SBNs were deposits deserves to be interfered with. Further, ld. Authorized Representative submitted that the appellant trust is running a school in Thiruvattar panchayat, catering to students in that remote village and the only source of income for the appellant is out of the fees collected from those students. The ld. Assessing Officer had not brought on record any concrete findings / evidence to reject the claim of the appellant or to doubt the source of the SBNs deposited. The ld. CIT(A) also without appreciating the documents filed before him had rendered cryptic findings and ultimately had dismissed the appeal of the Assessee. Hence, the ld. Authorized Representative prayed for deleting the addition made by the lower authorities.

Per contra, ld. Departmental Representative supported the orders of the authorities below.

We have heard both parties at length and also perused the relevant findings of the ld. Assessing Officer as well as the ld. CIT(A). We find from page 71 of paper book that appellant had obtained the certificate from the Mulagumoodu Branch bank regarding cash remittance details during demonetization period, which shows the breakup of the deposits in SBNs and non SBNs. The breakup of SBNs are only to the extent of Rs.6,66,500/-. The AO in his remand report dated 07.03.2024 at page 76 of paper book has confirmed the aforesaid factum of deposit. We further, at page 9 of the paper book find that the assessee’s closing cash balance as on 08.11.2016 was Rs.17,82,947/-. Therefore, the assessee has demonstrated the 08.11.2016 as the total deposits made in SBNs in both the branches was only Rs.16,92,000/-. It is also demonstrated by the assessee from the page 72-73 of the paper book that the consistent cash deposits in all the months. We further find that the AO has not rejected the books of account maintained by the assessee. We are of considered view that in this case AO had not brought on record any concrete evidence to reject the explanation of the appellant. Hence, we delete the addition sustained by the ld.CIT(A).

In result, appeal of the assessee stands allowed.