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Facts
The assessee, a firm, filed its return for AY 2017-18 declaring an income of Rs. 7,07,720/-. During the demonetization period, it deposited Rs. 29,00,000/- into its bank account. The Assessing Officer (AO) found that the assessee failed to substantiate the sources of these cash deposits.
Held
The Tribunal held that the assessee was unable to substantiate its claim regarding cash deposits and opening balance/professional receipts with cogent evidence. The Tribunal set aside the orders of the AO and CIT(A) and remanded the matter back to the AO for fresh adjudication after considering the requisite evidence and providing an opportunity of being heard.
Key Issues
Whether the assessee could substantiate the sources of cash deposits made during the demonetization period? Whether the assessee provided sufficient evidence for opening balance and professional receipts in cash?
Sections Cited
143(3), 143(2), 142(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “SMC’’ : NEW DELHI
Asstt. Year : 2017-18 Ansul Aggarwal & Co. vs. DCIT, Ward 61(1), A-296, Basement, New Delhi Shivalik, Malviya Nagar, New Delhi – 110 017 (PAN:-AAHFA0718Q) (Appellant) (Respondent) Appellant by: Shri Rahul Agrawal, Adv. Respondent by: Shri Ashok Kumar Pandey, Sr. DR. Date of Hearing 13.10.2025 Date of Pronouncement 22.10.2025 ORDER This appeal by the assessee is emanating from the order of the NFAC, Delhi in Appeal No. ITBA/NFAC/S/250/2025-26/1076409202(1) dated 23.05.2025. Assessment was framed by the ITO, Ward 61(1), Delhi u/s. 143(3) of the Income Tax Act, 1961 (hereinafter referred as ‘the Act’) for the assessment year 2017-18 vide its order dated 12.12.2019.
Brief facts of the case are that the assessee is a firm and filed its return for AY 2017-18 declaring total income of Rs. 7,07,720/-. During the year under consideration, the assessee made cash deposits of Rs. 29,00,000/- into bank account during demonetization period. Accordingly, a notice u/s. 143(2) of the Act dated 16.08.2018 was issued along with various other notices, viz., notice u/s. 142(1) and show cause notice. The assessee failed to give a satisfactory reply to the AO. The assessee also failed to give a satisfactory reply to the AO. The assessee also failed to substantiate sources of cash deposits by furnishing cogent evidences. Hence, the deposits by furnishing corroborative documents before the AO and the claim of the assessee in respect of opening balance of Rs. 14,67,000/- and professional receipt of Rs. 14,33,000/- in cash was without any evidences and sufficient cause. In view of the facts and circumstances of the case, it is crystal clear that during the assessment proceedings, the assessee was unable to substantiate its claim and did not provide the supporting evidences thereof before the AO. Hence, I set aside the orders of the Assessing Officer as well of CIT(A) and direct the Assessing Officer to consider the requisite evidences are required in order to decide the issue afresh, after giving adequate opportunity of being heard to the assessee. I remand the matter back to the file of the AO. I hold and direct accordingly. The instant appeal of the assessee is allowed for statistical purposes.
Order pronounced on 22.10.2025.