IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “C” BENCH: NEW DELHI BEFORE SHRI SUDHIR KUMAR, JUDICIAL MEMBER &

SHRI MANISH AGARWAL, ACCOUNTANT MEMBER [Assessment Year : 2017-18]

Kulbhushan Sahtani, vs ITO, 2525/7, Bedanpura, Ward-51(5), Karol Bagh, New Delhi-110005. New Delhi PAN-BKNPS5543L APPELLANT RESPONDENT Appellant by Shri R.K.Goyal, AR &

Ms. Sherry Goyal, Adv.

Respondent by Shri Om Prakash, Sr.DR Date of Hearing 22.05.2025 Date of Pronouncement 14.08.2025 ORDER PER MANISH AGARWAL, AM :

The present appeal is filed by the assessee against the order dated 05.07.2024 passed by Ld. Commissioner of Income Tax (A), National Faceless Appeal Centre (“NFAC”), Delhi [“Ld.CIT(A)”] in Appeal No.CIT(A), Delhi-17/10746/2019-20 u/s 250 of the Income Tax Act, 1961 [“the Act”] arising from the assessment order dated 29.12.2019 passed u/s 143(3) of the Act pertaining to assessment year 2017-18.

2. Brief facts of the case are that the assessee is an individual and is sole proprietor of M/s. B. Bhushan Gems and engaged in the business of trading of jewellery. The assessee has filed the return of income for the year under appeal on 03.11.2017, declaring total income of INR 9,26,020/-. The case of the assessee was selected for scrutiny for the reason that huge cash was deposited during demonetization in SBN. The AO issued notices from time to time asking the assessee for filing certain information with respect to the source and genuineness of the cash deposited in SBN during the period of demonetization and after considering the replies by assessee, the AO observed that there was abnormal increase in sales in the month of October, 2016 which is not possible looking to past history of assessee and therefore, he made the addition of INR 43,50,250/- being 25% of cash deposit of INR 1,74,01,000/- in SBN during the demonetization as unexplained cash deposits u/s 68 of the Act and further invoked the provision of section 115BBE of the Act.

3. Against this order, the assessee filed appeal before Ld.CIT(A) who dismissed the appeal of the assessee. Therefore, the assessee is in appeal before the Tribunal by taking following grounds of appeal:-

1. “On the facts and circumstances of the case, the order passed by the Ld. Commissioner of Income Tax (Appeals) ('CIT(A)') and Assessing Officer ('AO') is ex-facie arbitrary, illegal and bad in law, without affording proper opportunity of being heard, also against the provisions of the Income Tax Act, 1961 ('The Act'), decision of the Hon'ble Courts, CBDT instructions and principle of natural justice and thus forcing the Appellant into frivolous litigation.

2. Ld. CIT(A)/AO erred in not framing assessment order like a quasi- judicial authority as per principles laid down by the Hon'ble Supreme Court in the case of CIT v. Simon carves (105 ITR 205) that held that the taxing authorities exercise quasi-judicial powers and in doing so they must act in a fair and not a partisan manner.

3. The CIT(A)/AO has grossly erred on facts as well as in law in assessing the income at Rs.52,76,270 as against the returned income of Rs.9,26,020.

4. On law, facts and circumstances of the case, the Ld. CIT(A)/AO has grossly erred in making addition of Rs. 43,50,250 under section 68 r.w.s. 115BBE of the Act in respect of cash deposit in bank merely on possibility of manipulation in the figures of cash sales recorded in the books of accounts

5. The CIT(A) erred in making his observations on Pages 52 to 56 without rebutting the detailed submission given vide letter dated

01.05.2024 in the paperbook filed before CIT(A).

(i) The CIT(A) erred on Page 52 of his order observing that "a prudent businessman in the course of business shall deposit money in the Bank in one-go whereas it was deposited in piece meal" without realizing that it is his commercial decision as when to deposit or not and moreover, it is a common knowledge, that there were long queues after demonetisation for depositing cash, a fact ought not to be ignored by the CIT(A)

(ii) The CIT(A)