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of <h1>Tribunal upholds CIT (A) decision to delete income, dismisses Revenue's appeal.</h1> <h3>INCOME TAX OFFICER. Versus XYZ.</h3> INCOME TAX OFFICER. Versus XYZ. - TTJ 020, 400, Issues:1. Whether the deletion of the amount treated as income of the assessee firm by the CIT (A) was justified.2. Whether the explanation provided by the assessee regarding the acquisition of High Denomination Notes worth Rs. 4,26,000 was satisfactory.Analysis:Issue 1:The appeal filed by the Revenue challenged the deletion of Rs. 4,26,000 treated as income of the assessee firm for the assessment year 1979-80 by the CIT (A). The Revenue argued that the assessee failed to provide satisfactory reasons for the cash sales during the relevant period, and the source of High Denomination Notes remained unexplained according to the Income Tax Officer (ITO). The ITO added the amount as concealed income. However, the CIT (A) accepted the assessee's explanation that the cash sales were necessitated due to a strike at the SKF Co., and the High Denomination Notes were received from these sales. The CIT (A) concluded that the addition of Rs. 4,26,000 as income from undisclosed sources was not proper or reasonable, leading to its deletion.Issue 2:The second issue revolved around the adequacy of the explanation provided by the assessee regarding the acquisition of High Denomination Notes worth Rs. 4,26,000. The Revenue contended that the cash sales and the subsequent accumulation of High Denomination Notes were suspicious and improbable. They argued that the assessee failed to establish a nexus between the High Denomination Notes and the cash sales, pointing out discrepancies in the amount received and the nature of transactions. However, the authorized representative for the assessee supported the CIT (A)'s decision, emphasizing that the cash sales were genuine and supported by the books of account. The representative argued that the High Denomination Notes were legal tender at the time and did not require specific documentation of the source. The Tribunal agreed with the CIT (A) that the ITO lacked a proper basis for the addition of Rs. 4,26,000 and upheld the deletion of the amount as income.In conclusion, the Tribunal dismissed the Revenue's appeal, affirming the CIT (A)'s decision to delete the Rs. 4,26,000 from the assessee firm's income for the assessment year 1979-80.
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