BHUPENDRA FLOUR MILLS PVT LTD,BATHINDA vs. ITO, WARD 1(1), BATHINDA, BATHINDA

ITA 54/ASR/2025Status: DisposedITAT Amritsar20 February 2026AY 2017-18Bench: HON’BLE SHRI MANOJ KUMAR AGGARWAL (Accountant Member), SHRI UDAYANDASGUPTA (Judicial Member)10 pages
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What did the Tribunal hold?

The Tribunal held that interest on enhanced compensation is taxable under Section 56(2)(viii) of the Income Tax Act for assessment years post-amendment. However, it deleted the addition for unexplained cash deposits, stating the department failed to prove the cash was utilized elsewhere.

What were the facts?

The assessee claimed enhanced compensation and interest received from land acquisition as exempt. The AO taxed this amount, and the CIT(A) confirmed it. Separately, the AO added cash deposits made during demonetization as unexplained income, which the CIT(A) also confirmed.

What were the issues?

Whether interest on enhanced compensation is taxable under the amended provisions of the Income Tax Act, and whether cash deposits during demonetization can be treated as unexplained income without proof of alternative utilization.

Which sections of the Income-tax Act were involved?

Section 56(2)(viii),Section 145B(1),Section 69A,Section 115BBE

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Income Tax Appellate Tribunal, “DB” BENCH, AMRITSAR

Before: HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM & SHRI UDAYANDASGUPTA, JM

Pronounced: 20.02.2026

Manoj Kumar Aggarwal (Accountant Member)

1.

Aforesaid appeal by assessee for Assessment Year (AY) 2017- 18 arises out of an order of learned Commissioner of Income Tax (Appeals)-3, Gurgaon [CIT(A)] dated 25-11-2024 in the matter of an assessment framed by Ld. AO u/s 143(3) on 19-12-2019. In the assessment order, Ld. AO made twin additions of Rs.258.46 Lacs and Rs.233 Lacs which is subject matter of present appeal before us. Having heard rival submissions, the appeal is disp

The order continues below.

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