TaxTMI 
TaxTMI 
2025 (6) TMI 713
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.... Ld. CIT(A) is justified in deleting the addition of Rs. 7,90,34,500/- made u/s 69A of the Income Tax Act, 1961 by the AO on account of cash deposits of demonetized Legal Tender (Specified Bank Notes of Rs. 500 and Rs. 1000) without appreciating the fact that the assessee society was not authorized to take deposits of Specified Bank Notes during the period of demonetization in terms of Reserve Bank of India's Circular No. RB1/2016-17/112 DCM (Plg) No. 1226/10.27.00/2016-17 dated 08.11.2016? 2. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) is justified in not considering the various guidelines issued by Reserve Bank of India from time to time on the Demonetization including Circular No. RBI/2016-17/112 D....
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.... Income Tax records, noted that during the demonetization period ranging from the period 16/11/2016 yp 30/12/2016, the assessee has deposited cash in old currency amounting to Rs. 7,90,34,500/- out of total cash deposits of Rs. 14,32,87,200/- in various bank accounts (listed in para 4 of the assessment order). The Ld. AO made an addition of Rs. 7,90,34,500/- on account of such cash deposits in the bank account(s) during the demonetization period treating the same as unexplained money u/s 69A of the Act on the ground that Pathsansthas were not allowed to accept the old specified bank notes (SBNs) post midnight of 08.11.2016. 4. Aggrieved, the assessee challenged the matter in appeal before the Ld. CIT(A). The Ld. CIT(A) observed that cash d....
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....ng the course of appellant proceedings, the appellant has submitted the details of cash deposited in and withdrawn from the appellant's various bank accounts in Mumbai and Pune in A.Y. 2016-17, 2017-18 and 2018-19. It has been stated that a summary of such deposits and withdrawals was also submitted to Ld. AO. During A.Y 2017-18, the aggregate cash deposits made by the appellant in bank accounts were Rs. 122.15 crores as against Rs. 111.40 crores in A.Y. 2016-17 and Rs. 158.02 crores in A.Y. 2018-19. Thus, in A.Y.2017-18, the cash deposits increased by 9.65% and in A.Y. 2018-19, the cash deposits increased by 29.36%. No significant anomaly in the growth of cash deposits can be deduced from this data. Further, in A.Y. 2016-17, the lo....
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....e veracity of these details as submitted before him. The assertion of the Ld. AO that "Patsansthas" were not authorized to receive old notes has not been supported by any documentary evidence or RBI guideline. In view of the foregoing, the addition of Rs. 7,90,34,500/- u/s 69A of the Act is hereby directed to be deleted." 5. Dissatisfied, the Revenue is in appeal before this Tribunal and all the grounds of appeal relate thereto. 6. The Ld. DR strongly supported the order of the Ld. AO and submitted that the Ld. CIT(A) was not justified in deleting the addition made by the Ld. AO as there is clear contravention by the assessee of the RBI circular / guidelines issued in respect of legal tender (SBNs) deposited during the demonetization ....
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....the parties and perused the orders of the Ld. AO/CIT(A) and also paper book filed on behalf of the assessee. We have also considered various decisions cited before us by the Ld. AR. We find that the Ld.AO in the instant case has made addition of Rs. 7,90,34,500/- on account of cash deposits made during the demonetization period as unexplained money u/s 69A of the Act for the reason that the assessee was not authorized to receive SBNs (old currency notes) post 08/11/2016 and there is no whisper of questioning of the source of such deposits in his order. The Ld. CIT(A) deleted the addition made by the Ld. AO, the reasons of which have already been reproduced in the preceding paragraphs. It is not in dispute that the assessee has collected the....
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....62 and, therefore, the sum deposited is within the limit of Rs. 4000 per head which was allowed as per RBI notification at the time of demonetization. The Ld. CIT(A) has further observed that the assessee has provided all the requisite details such as state, full name, address etc. pertaining to its members who gave cash to the assessee, to the Ld. AO, the veracity of which could have been examined by him, but he did not do so and that the assertion of the Ld. AO that "Patsansthas" were not authorized to accept SBNs post 08.11.2016 has not been supported by any documentary evidence or RBI guideline. He, therefore, deleted the impugned addition of Rs. 7,90,34,500/- made by the Ld. AO. It is the submission of the assessee all along that the c....