SUBAIR KUNNATH,KOZHIKODE vs. ITO, WARD-2, KOZHIKODE

We find during the course of hearing with the valuable assistance coming from the Revenue sie that both the learned lower authorities have imposed sec.271AAAC(1) penalty of Rs.1,47,000/- @ 10% of the tax(s) payable u/sec.115BBE(1)(i) of Rs.14,70,000/- qua his cash deposits of Rs.24.50 lakhs made during demonetization.

Smt. Swarnalatha, learned DR has vehemently supports the impugned penalty levied in assessee’s hands.

We find in this peculiar backdrop that even the learned CIT(A)-NFAC is indeed very fair in making it clear in para(s) 6.4 to 6.5 pages 5 and 6 that the assessee had indeed withdrawn cash from his Axis Bank NRE account in the month of June and July 2016 which followed alleged re-deposits after four to five months thereof during demonetization in November, 2016. We invited the Revenue’s attention to the impugned lower appellate discussion to this effect which sufficiently prove that it is not an instance of the 3 ITA.No.826/Coch./2023 assessee having failed to attribute source of his cash deposits in entirety since his endeavour to treat his withdrawals as re-deposits herein, only has been rejected. Faced with this situation, we conclude that the impugned sec.271AAC(1) penalty of Rs.1,47,000/- deserves to be deleted. Ordered accordingly.

This assessee’s appeal is allowed in above terms.