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Facts
The assessee appealed an order from the CIT(A) concerning assessment year 2017-18. The Assessing Officer had made additions for cash deposits during demonetization and unexplained contractual receipts.
Held
The tribunal held that the cash deposit was directly correlated with prior cash withdrawals, thus no addition was warranted. Similarly, the contractual receipts were explained and arose from execution of work, making further addition unnecessary.
Key Issues
Whether cash deposits made during demonetization, correlated with prior withdrawals, are taxable as unexplained income. Whether contractual receipts from execution of work are taxable as unexplained income when duly explained.
Sections Cited
250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, SURAT BENCH, SURAT
(Assessment Year: 2017-18) Balda Majur & Kamdar Sahkari Income Tax Officer, Vs. Mandli Ltd., Ward-2, At. Balda, Ta. Nizar, Bardoli. Dist. Tapi-394370. [PAN : AAAAB1839R] (Appellant) .. (Respondent) Appellant by : Shri Suresh K Kabra, AR Respondent by: Shri Ajay Uke, Sr. DR Date of Hearing 19.01.2026 Date of Pronouncement 22.01.2026 O R D E R PER DR. B.R.R. KUMAR, VICE-PRESIDENT:-
This appeal has been filed by the Assessee against the order dated 18.10.2024 passed by the Ld. Commissioner of Income-Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (“the CIT(A) in short), under Section 250 of the Income-tax Act, 1961 (“the Act”), relating to the Assessment Year 2017-18.
Ground No.1
The Assessing Officer made an addition of Rs.30,40,000/- on account of cash deposits made during the demonetization period. The assessee submitted the bank statement reflecting cash withdrawals of Rs.14,40,000/-, Rs.15,00,000/- and Rs.1,00,000/- on 07.11.2016, and the amount of Rs.30,40,000/-, was subsequently deposited in the bank on 10.11.2016. Since the cash deposit is directly correlated with the prior cash withdrawals, no addition is called for.
Asst. Year : 2016-17 - 2– Ground No.2
With regard to the addition on account of unexplained deposit of Rs.43,91,924/- received from Kukermunda Taluka Panchayat towards execution of contractual work, it is noted that the said amount represents contractual receipts. As the receipts are duly explained and arise from execution of work, no addition is warranted.
In the result, the appeal of the assessee is allowed.
The order is pronounced in the open Court on 22.01.2026.