TaxTMI 
TaxTMI 
2026 (7) TMI 987
X X X X Extracts X X X X
X X X X Extracts X X X X
....come tax matter was suffering in medical emergency. The Ld. DR had not made any strong objection against the ordinate delay of 25 days. Accordingly, we condone the delay for filing of appeal for 25 days and the appeal is taken for adjudication. 3. The brief facts of the case are that he assessee is engaged in retail business of Saree and Dress Material during the impugned assessment year. The assessee filed the return by declaring total income of Rs. 35,83,710/- and book profit u/sec. 115JB of the Act of Rs. 37,38,748/-. The assessee regularly audited the accounts u/sec 44AB of the Act. During the impugned assessment year the assessee deposited cash in the bank account during the demonetization period. The Ld. AO selected the assessee's case in scrutiny. The assessee was asked to submit the details of cash deposit during the demonetization period after 08.11.2016. The Ld. AO found that the assessee deposited amount to Rs. 1,90,82,500/- as Specified Bank Notes (SBN) during the demonetization period from 09.11.2016 to 31.12.2016. The assessee was asked to provide explanation and detail cash deposited related to this period. The assessee had submitted the evidence in compliance of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....66015.00 19714306 5619375.00 35099696.00 0.28 May-14 11864794.00 0.00 11854794.00 0.00 7473174.10 12710756.9 2141874.00 22325805.00 0.33 Jun-14 15881769.00 0.00 15881769.00 0.00 5190479.90 10112409.1 2328593.00 17531482.00 0.29 Jul-14 19903594.00 0.00 19903594.00 0.00 6158513.00 13881262 3877127.34 23916902.34 0.26 Aug-14 22885112.00 0.00 22885112.00 0,00 6262832.00 16363975 367583.65 22259223.35 0.28 Sep-14 28961353.00 0.00 28961353.00 0.00 7107822.20 14404800.8 2549959.61 24062582.51 0.30 Oct-14 22262052.00 0.00 22262052.00 0.00 19761334.92 30031227.08 2015726.62 51808288.62 0.38 upto 8th Nov 8220135.00 0.00 8220135.00 0.00 3503808.00 6232273 95807.37 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....47.00 1724768.91 29149522.91 0.42 Aug-15 20964590.00 0.00 20964590.00 0.00 12232460.00 13,218,788.00 198481.00 25649729.00 0.48 Sep-15 31087611.00 0.00 31087611.00 0.00 7995124.00 13,661,649.00 98720.78 21755493.78 0.37 Oct-15 33036083.00 0.00 33036083.00 0,00 14002660.72 26,961,882.28 2565073.43 43529616.43 0,32 upto 8th Nov 6989151.00 0.00 6989151.00 0.00 5533464.00 10,929,198.00 112715.00 16575377.00 0.33 to 30th Nov 9308397.00 0.00 9308397.00 0.00 9890631.00 17,793,843.00 459457.63 28143931.63 0.35 Dec-15 30331124.00 0.00 30331124.00 0.00 11818837.00 25,085,056.00 38156.52 36942049.62 0.32 Jan-16 19479009.00 0.00 19479009.00 0.00 11292849.00 22,297,152.00 80508.00 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... The assessee declared the sales in State VAT return which was accepted. The assessee submitted a chart related comparative cash deposit for the year 2015 & for the year 2016. Particulars 1st April 2015 to 8th November 2015 1st April 2016 to 8th November 2016 Cash Sales Rs. 7,92,26,639/- Rs. 7,98,86,005/- Cash Deposit Rs. 6,60,13,625/- Rs. 5,09,60,700/- Particular 9th November 2015 to 31st December 2015 9th November 2016 to 31^st December 2016 Cash Deposit Rs. 2,22,40,462/- Rs. 1,79,81,499/- 7. The Ld. AR further argued and respectfully relied on the order of the Coordinate Bench of ITAT-Mumbai in the case of Ziva Jewellary Pvt Ltd vs ACIT, ITA No. 2625/Mum/2024 date of pronouncement 23/09/2024. The observation of the Bench is reproduced as follows:- "We find that the assessee had made the sales in the same ratio of cash & credit sales. The cash sales are below the value of Rs. 2,00,000/-. We note there is a corresponding increase in credit sales during the months of October and in November which are actually the festive season. The ld. AO assumed that on festive dates the shops would remain closed, and KYC of the buyers wer....
X X X X Extracts X X X X
X X X X Extracts X X X X
....us of substantiating the source for the deposits made in SBN during demonetisation period and that the addition made by the revenue without disputing the business income of the assessee is not tenable. In view of the above discussion, we are of the considered view that the addition of Rs 33,40,327/- made under section 68 of the Act cannot be sustained and is therefore deleted." The ld.AO was not satisfied with the representation of books of account of the assessee. But no specific lacuna was found for rejection of Books of accounts of the assessee. The submitted all the relevant documents before the ld. AO and the submissions are annexed in APB pages 116 to 123. We respectfully relied on the orders of ITAT-Mumbai Bench in the cases of M/s Kandan Jewellers Pvt Ltd (supra), Ramlal Jewellers (P) Ltd (supra) and Pukhraj Nathmal Jain (supra). We set-aside the impugned appeal order and the addition amount to Rs. 3,16,97,000/- is quashed." 8. The Ld. DR vehemently relied upon the orders of the revenue authorities and submitted that the assessee had deposited cash far in excess of the normal pattern of cash deposits during the demonetization period. The Ld. DR contended that th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ted belong to the assessee and cash was deposited by him. The transactions came to the notice of the department through AIR information. As per the IT Act, the entire onus is on the assessee to explain the transactions in the bank accounts. If cash is deposited in the bank account, the onus is on the assessee to explain the source of cash deposited with supporting evidence. In the present appeal, the issue is with regard to the cash deposits and the sources of such cash deposits. During the course of appellate proceedings, the appellant has not explained the sources for such cash deposits. It is simply explained that the cash was received from the sales. However, the appellant was not authorized to accept SBN notes on and from 9.11.2016. The AO observed that cash sale for the period from April 2015 to October 2015 were at Rs. 7,36,93,175 and April 2016 to October 2016 were Rs. 7,67,77,286/-. There is no much change in the sales. However, the cash in hand as on 8.11.2016 in comparison to 9.11.2015 is very high and is almost more than 500%. This sudden increase in cash in hand on 8.11.2016 is non-satisfactory and the assessee has failed to provide any satisfactory explanation. As the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....016 were broadly similar to the preceding year whereas the cash deposits during the demonetization period were in fact lower than the immediately preceding corresponding period. The assessee had explained the source of cash deposits from regular business receipts duly recorded in the books of account. The Ld. AO merely proceeded on presumption and suspicion without bringing any cogent evidence to rebut the documentary evidences furnished by the assessee. 11. We find force in the contention of the Ld. AR that the assessee had discharged the primary onus cast upon it by furnishing complete books of account, VAT returns, stock statements, quantitative details and cash book. The Ld. AO neither found any inflation in sales nor detected any bogus purchases or abnormal gross profit. In absence of rejection of books of account, the cash deposits made out of recorded business receipts cannot be treated as unexplained money under section 69A/68 of the Act merely because the deposits were made during the demonetization period. The observations of the Ld. CIT(A) that the assessee was not authorized to receive SBN after 08.11.2016 also do not support the impugned addition because the assesse....