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Income Tax Appellate Tribunal, DELHI BENCH: “SMC” NEW DELHI
Before: SHRI SATBEER SINGH GODARA
Date of hearing 24.11.2025 Date of pronouncement 24.11.2025 ORDER This assessee’s appeal for assessment year 2017-18, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s DIN and order no. ITBA/NFAC/S/250/2025-26/1081166600(1), dated 25.09.2025 involving proceedings under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties. Case file perused.
Coming to the assessee’s sole substantive grievance herein, it emerges during the course of hearing that both the learned lower authorities have treated its cash deposit during demonetization amounting to Rs.40.73 lakhs as unexplained under section 68 r.w.s. 115BBE of the Act; in assessment order dated 14.12.2019 as upheld in the lower appellate discussion.
I have given my thoughtful consideration to the assessee’s and the Revenue’s respective vehement submissions and perused the former’s paper-book running into 240 pages inter alia compiling all of his statutory notices, reply(ies) thereto as well as regular books of account etc. The assessee’s case all along has been that since it is engaged in the regular business activity of fabric trading etc. having duly got audited its books of account, the impugned cash deposits could not have been treated as unexplained which deserves to be deleted therefore. The Revenue case on the other hand is that the impugned addition has been made on account of the assessee’s failure only to plead and prove all the relevant facts before the learned lower authorities. Be that as it may, the fact remains that there is no specific rebuttal to the assesssee’s foregoing detailed evidence explaining source of the impugned cash deposits to its regular business sales in fabric trading etc. It is thus deemed appropriate in these peculiar facts and in the larger interest of justice that a lumpsum addition of Rs.2 lakhs only would
2 | P a g e be just and proper with a rider that the same shall not be treated as a precedent. The assessee gets relief of Rs. 38.73 lakhs in other words. Necessary computation shall follow as per law.
So far as assessee’s assessment under section 115BBE is concerned, I quote S.M.I.L.E. Microfinance Ltd. Vs. ACIT, W.P. (MD) No.2078 of 2020 & 1742 of 2020, dated 19.11.2024 (Madras) that the impugned statutory provision would come into effect on the transaction done on or after 01.04.2017 only. The assessee is accordingly directed to be assessed under the normal provision as per law.