KULANTHAIVELU ELANGO,VIRTUDHUNAGAR vs. ACIT CIRCLE 1, VIRUDHUNAGAR

The only effective ground of appeal in assessee’s appeal is against confirming Rs.31,00,000/- cash deposit in bank account as unexplained cash of SBNs during the demonetization period u/s 68 of the Act by Ld CIT(A) out of Rs.39,00,000/- addition made by the Assessing Officer .

The brief facts of the case are that the assessee has deposited Rs.39,00,000/- in the form of SBN after demonetization i.e. on 08.11.2016 as under:

The assessee has explained the source of cash deposit as opening cash balance of Rs.39,27,298.77/- as on 08.11.2016. However, the A.O has rejected the assessee’s explanation on the ground that the assessee books of accounts are not audited and the opening balance shown in cash book is Rs. 39,27,298.77/- as on 08.11.2016 and the cash cannot be in 77 paisa. The Ld. CIT(A) has :- 3 -: decided the appeal ex-parte allowing 20% of the cash deposit as explained source of cash deposit for the reason that the assessee is involved in the business of civil construction and some cash must be available to make expenses in cash like labour and material purchase .

The Ld. A.R has submitted that the Ld. CIT(A) has decided the appeal ex-parte and therefore, one more opportunity may be given to prove his case.

On the other hand, the Ld. D.R argued that the assessee has not made any submission, despite of sufficient opportunities provided to the assessee.

We have heard the rival contentions, and perused the materials available on record. The Ld. CIT(A) has decided the appeal ex-parte without examining the cash book, in which sufficient balance as on 08.11.2016 has been shown. The Ld. AR has argued that sufficient opportunity was not given to submit the evidences to prove his case.

In the result, the appeal filed by the assessee is allowed for statistical purposes.