IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “SMC”, HYDERABAD (Through virtual hearing)

BEFORE SHRI LALIET KUMAR, JUDICIAL MEMBER

O R D E R

PER LALIET KUMAR, J.M.

The appeal of the assessee for A.Y. 2017-18 arises from the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dt.12.01.2024 invoking proceedings under section 143(3) of the Income Tax Act, 1961 (in short, “the Act”).

2. The grounds raised by the assessee read as under :

“ 1. Aggrieved against the order U/sec 250 of the Income Tax Act, passed on 12-01-2024 by the Hon’ble CIT(Appeals)- NFAC, wide Order No ITBA/NFAC/S/250/2023-24/1059677615(1), the appellant is in appeal before the Hon’ble Income Tax Appellate Tribunal- Hyderabad.

2. That the learned CIT (Appeals), has grossly erred in law by not considering the facts and grounds as mentioned in the appeal form 35.

3. That the learned CIT (Appeals), has grossly erred both in law and facts in by treating the cash deposits made during the demonetization period as unexplained money U/sec 69A and taxed U/sec 115BBE which is not valid.

4. That the learned AO, has grossly erred both in law & facts and failed to appreciate the fact that cash deposited was out of appellant past savings/past cash withdrawals and also from appellants spouse past savings given by the appellant to incur household expenses. or from cash gifts given by their children/Son In Law.

5. Ao has failed to consider the facts that, a person with the credibility of having the service of 40yrs approximately at the executive level, it will be more often to hold the cash in hand of Rs 11,92,500/-, after having paid the taxes for his earnings, and due to demonetization such accumulated cash savings was deposited into the bank.

6. That the learned CIT (Appeals), HYD- has erred both in law and on facts by dismissing the appeal filed before him for non- submission of additional evidence, where as additional evidence “Agreement of sale” is not relevant here as it was entered and cancelled and money was paid back to Mr. Anjaneyulu, and learned AO also failed to consider the fact that cash deposited was out of his past savings and we are taking the plea of past withdrawals, past withdrawals itself were sufficient to prove that cash deposits were made out of past withdrawals and no other additional evidence was required.

7. That the learned Assessing Officer has erred both in law and on facts in adding Rs, 11,92,500 to the total income of the appellant and levied Rs 7,15,500 tax U/sec 115BBE and surcharge of Rs.1,78,872, as per the Act. which are not leviable on the facts of the instant case.

3. The brief facts of the case are that assessee is an individual and filed his return of income for the A.Y. 2017-18 on 28.07.2017 admitting total income at Rs.9,00,720/-. Further, the case was selected for scrutiny to verify the cash deposit during the demonetization period and a notice u/s 143(2) dated 24.09.2018 was issued to the assessee. Further, notices u/s 142(1), calling for information and show-cause notice were issued to the assessee. In response to the notices issued, the assessee submitted the information online. During the course of assessment, Assessing Officer noticed that assessee had made cash deposits in various banks totaling to Rs.11,92,500/- during the demonetization period and hence, the Assessing Officer issued notices u/s 142(1) to the assessee and show-cause notice to explain the sources of cash deposits along with relevant supporting documentary evidences. In res