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of <h1>Tribunal allows appeal against unexplained cash credit addition for demonetization deposits from recorded business sales</h1> <h3>Debraj Sahoo Versus DCIT, Cir. -44, Kolkata</h3> Debraj Sahoo Versus DCIT, Cir. -44, Kolkata - TMI Issues Involved:Appeal against order u/s 250 of the Income Tax Act, 1961 for AY 2017-18 regarding unexplained cash deposits during demonetization period.Detailed Analysis:Issue 1: Unexplained Cash DepositsThe appellant, engaged in the business of fabrication and trading, faced scrutiny due to cash deposits during demonetization. The Assessing Officer treated a significant cash deposit as unexplained income under section 68 of the Act. The CIT(A) partially allowed the appeal. The appellant contended that the cash deposits were from sales to reduce credit risk. The appellant provided documentary evidence of cash deposits before, during, and after demonetization, emphasizing sales-related cash deposits. The AO disregarded the evidence, leading to the appeal.Issue 2: Arguments and CitationsThe appellant argued that the AO overlooked submitted details and added all cash deposits as unexplained. The appellant cited various judicial decisions supporting their case, emphasizing the importance of sales proceeds and proper recording in the books of account. The Departmental Representative supported the CIT(A)'s order.Issue 3: Tribunal's AnalysisThe Tribunal examined the documentary evidence provided by the appellant, including bank statements, financial reports, and cash books. It noted substantial cash deposits before and after demonetization, supported by sales transactions. The Tribunal highlighted that the appellant explained the nature and sources of cash deposits, fulfilling obligations under section 68 of the Act. Citing relevant case laws, the Tribunal emphasized that sales proceeds already declared as income should not be treated as unexplained cash credit.Issue 4: DecisionAfter considering the facts, evidence, and legal precedents, the Tribunal set aside the CIT(A)'s order regarding unexplained money. The Tribunal allowed the appellant's appeal, concluding that the appellant successfully established the legitimacy of cash deposits from sales. The order was pronounced in favor of the appellant on 8th August, 2024.This detailed analysis outlines the key issues, arguments, tribunal's assessment, and final decision regarding the appeal against unexplained cash deposits during demonetization, providing a comprehensive overview of the judgment.
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