2024 (10) TMI 773

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.... the case are that the assessee has filed its return for A.Y. 2017-18 on 13.11.2017 declaring total income of Rs. 23,83,240/-. According to the ld. Assessing Officer, the case of the assessee was selected for scrutiny under CASS and a notice under section 143(2) was issued and served upon the assessee. On scrutiny of the accounts, it revealed to the ld. Assessing Officer that during demonetization period between 8th November to 31st December, 2016, the assessee has deposited a sum of Rs. 1,29,23,200/- in two Bank accounts, namely (i) Axis Bank, New Barrackpore Branch Current Account Rs. 1,19,30,000/- and (ii) HDFC Bank, Madhyamgram Branch Current Account Rs. 9,93,200/-. The ld. Assessing Officer has directed the assessee to explain the source of such deposits and as to how it should not be treated as unexplained money under section 69A of the Income Tax Act. The assessee has submitted requisite details, but ld. Assessing Officer did not discuss them. He made the addition of the above amount by recording following finding:- "In this regard, notice u/s 142(1) was sent to the assessee on different dates and was served upon the assessee via e mail and speed post and he was req....

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....ash transaction module with regard to the deposits in demonetised currency stated that the said deposits were from his cash balance held on 08/11/2016. But during the proceedings, the assessee could not furnish the cash book to show that the cash was actually held as balance as on 08/11/2016. Also it is strange that the assessee has given different explanations in different times regarding the source of deposits in specified bank notes. So, it is quite clear that the assessee did not record the deposits made in demonetized currency notes during the specified period in his books of account and the amount of Rs. 12923200/- is unaccounted for. That is the reason of the assesses constant reluctance to furnish the books of account and furnishing contradicting explanations despite being given a no. of opportunities to do the same. Thus, the assessee failed to prove the nature and source of acquisition of the money in its possession amounting to Rs. 12923200/- . Hence, the amount of Rs. 1,29,23,200/- is considered as unexplained money u/s 69A of the Act in the hands of the assessee and added back to his income and to be taxed u/s 115BBE of the Act. Penalty u/s 271AAC of ....

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....Counsel for the assessee emphasized that conditions no. (a) & (b) are cumulative. In the present case, the money has already been recorded in the books. The source has been accepted from the sales of the business. Therefore, ld. Assessing Officer has erred in invoking section 69A and making the additions. 8. The ld. D.R., on the other hand, relied upon the orders of revenue authorities. He submitted that the assessee could not give plausible explanation to the ld. Assessing Officer at the time of assessment proceeding. Therefore, ld. Assessing Officer has rightly treated such deposit as unexplained money of the assessee, which deserves to be assessed under section 69A of the Income Tax Act. 9. We have duly considered the rival contentions and gone through the record carefully. There is no dispute with regard to the fact that total sales of the assessee during the year was of Rs. 48,79,27,027/-. It has made purchases of Rs. 47,24,59,237/-. The analysis made by the assessee in a tabular form in the submission of the ld. Counsel for the assessee is worth to note here, which reads as under:- A.Y. 2017-18 Name of Bank Branch Address Account No. Amount of cash deposi....

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....ram, flour and related products in cash. The other argument given by the ld. Counsel for the assessee that cash was recorded and, therefore, section 69A cannot be invoked. For buttressing this proposition, he relied upon the judgment of ITAT, Chandigarh Bench in the case of DCIT -vs.- Roop Fashion reported in [2022] 145 taxman.com 216. In that case also, on identical circumstances the Revenue disbelieved the cash sales. The Tribunal has examined this issue in detail and then, compared the total sales of A.Ys. 2015-16, 2016-17, 2017-18 and deleted the addition. The cash was recorded in the books hence it cannot be termed as unexplained cash. Only thing which was required to be explained was the source of such deposits, which assessee has explained i.e. out of sale proceeds, deposits have been made. 12. On due consideration of the above facts and circumstances, we are of the view that addition made by the ld. Assessing Officer and confirmed by the ld. CIT(Appeals) is not sustainable. Accordingly, we allow this ground of appeal and delete the addition of Rs. 1,29,23,200/- 13. In the next ground of appeal, the assessee has pleaded that ld. CIT(Appeals) has erred in confirming the....