Tribunal orders deletion of Rs.9,81,000 added for demonetization cash deposits The Tribunal allowed the appeal, ordering the deletion of the addition of Rs.9,81,000/- towards cash deposited during the demonetization period, as the ...
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Tribunal orders deletion of Rs.9,81,000 added for demonetization cash deposits
The Tribunal allowed the appeal, ordering the deletion of the addition of Rs.9,81,000/- towards cash deposited during the demonetization period, as the cash deposits were found to be from the assessee's normal business operations and properly accounted for in the books.
Issues involved: Confirmation of addition of Rs.9,81,000/- towards cash deposited during demonetization period.
Summary:
Issue 1: Addition of cash deposits during demonetization period
The appeal was against the order passed by CIT(A) confirming the addition of Rs.9,81,000/- towards cash deposited during demonetization period. The assessee, a partnership firm, explained that the cash deposits were made from normal business operations. The Assessing Officer (AO) accepted the availability of cash to the tune of Rs.2.00 lakh and made an addition of Rs.14,81,000/-. The CIT(A) allowed further relief of Rs.3.00 lakh, resulting in sustaining the addition at Rs.9,81,000/-. The Tribunal heard the submissions and examined the relevant material on record.
Issue 1 Details:
The assessee deposited Rs.16.81 lakh in two bank accounts during the demonetization period, explaining the source as normal business operations. The opening cash in hand as on 01-04-2016 was Rs.13,64,991/-. The return for the preceding assessment year 2016-17 was filed before the demonetization scheme came into effect, accompanied by audited financial accounts. The cash book from 01-04-2016 showed proper reflection of cash transactions, with no negative cash balance on any day. The closing cash in hand stood at Rs.3,74,580/-. The Tribunal observed that the cash deposited during demonetization was from the assessee's business operations and properly accounted for in the books. Consequently, the addition sustained in the first appeal was ordered to be deleted.
Conclusion:
The Tribunal allowed the appeal, pronouncing the order on 16th March, 2023.
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