NIRAJ KUMAR SINGH,DELHI vs. INCOME TAX OFFICER 70(5), DELHI

In this case there is a delay of 8 days in filing the appeal, after perusing the records, I am of the considered view that reasonable reasons have been attributed to the assessee in filing the belated appeal, hence, I condone the same.

Brief facts of the case are that assessee is an individual and filed his return of income for AY 2017-18 declaring total income on Rs. 4,44,400/-. The case was selected for Limited scrutiny under CASS for the reason “cash deposit during demonetization period”. Notices were issued from time to time and duly served upon the appellant. The AO had passed order u/s. 143(3) of the Act with assessed total income of Rs. 16,03,400/- and addition of Rs. 11,59,000/- u/s. 69A of the Income Tax Act, 1961 read with section 115BBE of the Act was added in the hands of the assessee. However, in appeal, Ld. First Appellate Authority sustained the addition. Against the above, assessee appealed before the Tribunal.

After hearing the Ld. DR and perusing the records, I note that it was contended before the AO that the appellant submitted that he had made ATM cash withdrawal of RS. 3,02,000/- out of his HDFC bank loan amount from 31.10.2016 to 08.11.2016 at various places i.e. Mejar Ganj and Sitamarhi. He had taken loan from HDFC bank prior to 2016. He had also took loan of Rs. 9,84,328/- on 17 October 2016 of which Rs. 6,38,616/- credited to his HDFC bank account and the remaining was adjusted against prior loan balance existing at 17 October, 2016. Further he submitted that when he was in home town in Bihar to celebrate Diwali festival and as demonetization took place during those period he took cash to deposit in his bank account in Delhi. AO noted that the assessee has made cash deposits amounting to Rs. 11,59,000/- in FY 2016-17 relevant assessment year 2017-18 during demonetization period remained unexplained. The assessee failed to give valid explanation about the nature and source of cash deposits, hence the value of cash deposits during demonetization period is deemed as unexplained money u/s. 69A of the Income Tax Act, 1961 read with section 115BBE of the Act and added to the total income of the assessee. Ld. CIT(A), upheld the addition in dispute. I have given my thoughtful consideration to the assessee’s contentions before the lower authorities and Revenue’s contention in support of the impugned addition. I find no reason to accept either parties stand in entirety. This is for the precise reason that neither the assessee has been able to properly explain the source of cash deposits nor the department could simply brush aside all the relevant evidence at one go. Be that as it may, the tribunal is of the considered view that in these peculiar facts, it is deemed appropriate in the larger interest of justice to confirm the impugned addition of Rs. 11,59,000/- to Rs. 2,59,000/- only with a rider that the same shall not be as a precedent. The assessee gets relief of Rs. 9,00,000/- in other words. Necessary computation shall follow as per law.