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2024 Supreme(Online)(ITAT) 3799
INCOME TAX APPELLATE TRIBUNAL (CUTTACK BENCH)
Shri George Mathan, J, Manish Agarwal, ACJ
MR. BICHITRANANDA ROUT SHANKARPUR CUTTACK – Appellant
Versus
INCOME TAX OFFICER WARD-2(1) CUTTACK – Respondent
ITA No.60/CTK/2024
For the Appellants/Petitioners: Shri B.R.Panda
For the Respondents: Shri S.C.Mohanty, Sr DR
The court upheld the addition of Rs.8,35,500/- under Section 69A as unexplained income, stating that the taxpayer failed to satisfactorily explain the source of cash deposits during the demonetization period, despite claims of proper sales documentation.
Headnote:(A) Income Tax Act - Sections 44AD, 69A and 115BBE - Appeal against addition of Rs.8,35,500/- under Section 69A as unexplained income from cash sales during demonetization period - Appellant contended that the amount was from sale proceeds, not unexplained income - Court found the rationale of the lower authorities valid as the source of cash deposits was not satisfactorily explained - Relied on precedents indicating that cash transactions and deposits during the demonetization period require substantiation of source - Assessing officer permitted to examine source with no substantial change in cash income; addition upheld. (Paras 2, 4, 10, 11, 12, 17, 18)
(B) Procedure - Transfer from SMC Bench to Division Bench - No speaking order required for valid transfer; procedural compliance observed - The rationale provided during court proceedings suffices. (Paras 6, 12)
(C) Legal Tender - SBNs - Accepting SBNs after demonetization permissible till the appointed date of 31.12.2016; basis of addition must focus on verified source of deposits. (Paras 10, 11)
| Table of Content |
|---|
| 1. identification of parties and procedural background. (Para 1 , 2) |
| 2. arguments regarding the treatment of cash deposits and sbns. (Para 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11) |
| 3. court's analysis on the legal principles regarding sbn deposits. (Para 12 , 13 , 14 , 15 , 16 , 17) |
| 4. final order on the dismissal of the appeal. (Para 18) |
ORDER
Per Bench This is an appeal filed by the assessee against the order of the ld CIT(A), NFAC, Delhi dated 12.01.2024 in Appeal No.CIT(A), Cuttack/10220/2019-20 for the assessment year 2017-18.
2. Shri B.R.Panda, ld AR appeared for the assessee and Shri S.C.Mohanty, Sr. DR appeared for the revenue.
3. Ld AR has filed written submission as follows:
1. That in filing of said Appeal before this Hon'ble forum stating inter- alia that the Authorities below had disposed of the matter without proper appreciation of the issues involved for considering the facts and the points of law raised in the matter involving the sale proceed derived at Rs.69,79,500/- from sale of fruits etc. and adopted the profit @8% in accordance with the provision of section 44AD of the IT Act.
2. That no proper consideration I of the law and the facts could be appreciated rather wrongly held that a sum of Rs.8,35,500/- out of the sale proceeds had remained as unexplained money which attracted provision Section 69A of the IT Act is totally wrong, absurd and illegal in the facts of the case and the Appellant urged for deletion of the matter and submitted that Rs.8,35,500/- got deposited in the Bank Account should not have been treated as unexplained Income U/s69A of the IT Act and there was no concealment, unexplained and suppression of any manner got attracted the provision of Section 69A of the IT Act.
3. That the Appellant in furnishing the Grounds of Appeal had already submitted stating inter-alia that the money deposited in the Bank Account at Rs.8,35,500/- out of the sale proceeds should not have been treated as unexplained money U/s69A. of the IT Act and drawn the tax liability under the provisions of Section 115BBE of the IT Act.
4. That the Appellant in addition to submitting the above had categorically stated that the addition was made in mechanical manner holding the amount deposited at Rs.8,35,500/- taxable U/s 69A of the IT Act is totally wrong improper and contrary to the facts of the case. It is submitted that the cash balance available at Rs.24,34,404/- was inclusive of Rs.21,85,500/-which further consisted of Rs.8,35,500/- in SBN (Demonetization amount)The whole transactions derived amounting to Rs.69,79,500/- in the relevant year from business etc., got properly explained and stated in furnishing of the Accounts and section 44AD of the IT Act should have been applied without making separate addition U/s69A of the IT Act, therefore this Hon'ble Forum should appreciate the illegalities caused in the matter.
5. That that the demonetization amount should not have been added in the facts of the case as is most absurd and illegal which got already been considered in the similar Appellate Forums in most preferably by the Hon'ble Tribunal ((C" Bench of Chennai genuine in the case ITA No.557/CHNY/2022 for the Assessment year 20:1,7-18 that is the same year absolutely applicable in the case of the Appellant because in the relevant year in deposing of the appeal vide dated 04.01.2023 the Hon'ble Division Bench held that the amount demonetized with effect from 08.11.2016 against the transaction of "fruits" which found to be perishable was forced to get accepted the demonetization cash which cannot be taxed as unexplained cash credit U/sl15BB of the IT Act.
6. That the Hon'ble Division Bench even if found that from SI. No. 7 to 23 prescribed the payments to Central Govt. Account through different institutions commencing from Government hospital, purchase of Railway tickets from counter etc., even if had dealt with the acceptance of the demonetization amount but the relaxation to made have found the goods for trans
