SNEH LATA SARAF,KOLKATA vs. ITO, WARD-50(3), KOLKATA

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, KOLKATA डॉ. मनीष बोरड, लेखा सद�य के सम� Before Dr. Manish Borad, Accountant Member I.T.A. No.297/KOL/2024 Assessment Year: 2017-18

Sneh Lata Saraf …. Appellant (PAN: AKXPS0345R) Vs. Income tax Officer, Ward-50(3), Kolkata .… Respondent Appearances by: Shri Abhishek Bansal, FCA appeared for Appellant. Shri B. K. Singh, JCIT appeared for Respondent. Date of concluding the hearing : 18.07.2024 Date of pronouncing the order : 25.07.2024 ORDER This appeal filed by the assessee pertaining to Asessment Year (in short “AY”) 2017-18 is directed against the order passed u/s 250 of the Income Tax Act, 1961 in short the “Act”) by Ld. Commissioner of Income-tax (Appeal), National Faceless Appeal Centre (NFAC), Delhi [in short Ld. “CIT(A)”] dated 05.02.2024 arising out of the assessment order u/s 143(3) of the Act by ITO, Ward-50(3) Kolkata dated 18.12.2019. 2. The only grievance of the assessee is against the addition made on account of unexplained cash deposit of Rs.10,14,500/- during demonetization period. 3. Brief facts of the case are that the assessee is a senior citizen and furnished her return of income for the impugned

I.T.A. No. 297/Kol/2024 Sneh Lata Saraf AY : 2017-18 assessment year 2017-18 on 31.01.2018 declaring total income of Rs.3,95,110/- followed by notices u/s. 143(2) and 142(1) of the Act issued and duly served upon the assessee. During the course of the assessment proceeding, Ld. AO confronted the assessee about the source of cash deposit of Rs.10,12,500/- during demonetization period, but there was no compliance on behalf of the assessee. Ld. AO completed the assessment making addition of Rs.10,12,500/- u/s. 69A of the Act and assessed the income at Rs.14,07,610/-. 4. Aggrieved, assessee preferred appeal before the Ld. CIT(A) and furnished the details about the source of cash deposit which majorly included accumulated cash in hand, cash withdrawal during FYs 2014-15 and 2015-16 and other income earned during the year. Ld. CIT(A) was not satisfied since the claim was not supported with requisite evidence to his satisfaction and thus confirmed the addition. Aggrieved, assessee is now in appeal before this Tribunal. 5. Ld. Counsel referring to the paper book and written submission filed before Ld. CIT(A) submitted that the assessee regularly files her income tax return and income is mainly from rent, job work and bank interest and also submitted that as per Balance Sheet as at 31.03.2016 there was cash in hand at Rs.19,50,703/-. He submitted that the cash in hand as at 31.03.2016 mainly included the withdrawals made during the FY 2015-16 and the funds were kept with the assessee and the same were utilised for making the alleged cash deposit during the demonetization period. Reference made to various bank account

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I.T.A. No. 297/Kol/2024 Sneh Lata Saraf AY : 2017-18 held with Kotak Mahindra Bank, Dena Bank and HDFC Bank where regular transactions are being carried out. 6. On the other hand, Ld. DR vehemently argued supporting the orders of the lower authorities. 7. I have heard both the parties and perused the material available on record. Addition u/s. 69A of the Act on unexplained cash of Rs.10,14,500/- has been challenged by the assessee. Though there was no compliance before the Ld. AO but the assessee made detailed submission before the Ld. CIT(A. At page 28 of the paper book, copy of written submission filed before the Ld. CIT(A) has been placed. In this assessee has explained the source of cash deposit which mainly include Rs.3,50,000/- from her stridhan Rs. 5,00,000/- being cash withdrawal from bank in FY 2015-16 along with other minor withdrawals from bank and income earned during the year source has been explained. Further, a statement showing cash withdrawal and cash deposit during the period of 01.04.2011 to 31.03.2017 is also filed demonstrating that there are regular withdrawals from bank which have been subsequently utilised for depositing the cash in various bank accounts. Ld. CIT(A) has doubted the purpose of retaining cash in hand by the assessee. However, it has been consistently held by various Coordinate Benches as well as this Tribunal that there is no restriction under any law if a person keeps the cash in hand subject to the condition that the source is sufficiently explained. On perusal of the Balance Sheet as at 31.03.2016 placed at page 26 of the paper book, I also note that the capital of the assessee is approx. Rs.1.14 Cr. and the cash in

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I.T.A. No. 297/Kol/2024 Sneh Lata Saraf AY : 2017-18 hand as at 31.03.2016 is at Rs.19,50,703/- which also explains the source of cash deposit. Taking into consideration all these facts, I am of the considered view that assessee had sufficient cash in hand available for making the alleged cash deposit during the demonetization period in her bank account. Thus, I hereby set aside the finding the Ld. CIT(A) and delete the addition of Rs.10,50,000/-. 8. In the result, appeal of the assessee is allowed. Order is pronounced in the open court on 25th July, 2024.

Sd/-[Dr. Manish Borad] Accountant Member Dated: 25th July,2024

J.D. Sr. PS. Copy of the order forwarded to: 1. Appellant – Sm. Sneh Lata Saraf, 56, Netaji Subhash Road, Kolkata-700001. 2. Respondent – ITO, Ward-50(3), Kolkata 3. CIT(A), NFAC, Delhi 4. CIT- 5. Departmental Representative 6. Guard File. True copy By order Assistant Registrar ITAT, Kolkata Benches, Kolkata

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