2024 (8) TMI 1718

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..... The assessee in this appeal has agitated against the confirmation of addition by the CIT(A) of Rs. 73,80,000/-, which has been made by the Assessing Officer by treating the cash deposits made in Specified Bank Notes during the demonetization period as unexplained income of the assessee u/s 68 of the Act. 3. The brief facts of the case are that the assessee is a cooperative credit society. The assessee is engaged in the business of providing loans and advances to its members. The Assessing Officer noted that during the period of demonetization, the assessee-society deposited a total cash of Rs. 73,80,000/-. The assessee-society claimed that this amount of deposits was out of deposits received from the members of the society. The details....

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....68 of the Act were not applicable in this case. That the source of the deposits was duly explained to the Assessing Officer, therefore, it cannot be said to be unexplained income of the assessee. 6. The ld. DR however has relied upon the findings of the lower authorities. 7. We have heard the rival contentions and gone through the record. In this case, the ld. counsel has explained that the amount in question was already collected from the farmers-members and the same was further deposited by the assessee-society in the bank account. The ld. counsel has duly explained that the amount in question was collected and deposited during the first three days of the demonetization period. In our view, the impugned additions are not sustainable....

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....as collected the demonetized notes after 8.11.2016 in violation of the notifications issued by RBI. Accordingly, he has taken the view that the above said amounts represents unexplained money of the assessee. I am unable to understand the rationale in the view taken by A.O. I noticed that the AO has invoked the provisions of sec.68 of the Act for making this addition. I also noticed that the assessee has also complied with the requirements of sec.68 of the Act. The AO has also not stated that the assessee has not discharged the responsibility placed on it u/s 68 of the Act. Peculiarly, the AO is taking the view that the assessee was not entitled to collect the demonized notes and accordingly invoked sec.68 of the Act. I am unable to underst....