AMAR SINGH BINDRA,AMBALA V. INCOME TAX OFFICER, WARD-1, AMBALA

ITA 254/CHANDI/2025

AI Insights

The case involves an appeal by Shri Amar Singh Bindra against an order by the Commissioner of Income Tax (Appeals), which confirmed an addition of Rs.54.10 Lacs to the assessee's income for the Assessment Year 2017-18. This addition was initially made by the Assessing Officer under section 143(3) of the Income Tax Act, alleging that the cash deposits made during the demonetization period were unaccounted. The assessee, engaged in the commission business of fruits and vegetables, argued that these deposits were from legitimate cash sales, supported by various documents including bank certifications and sales ledgers. The Tribunal, after considering the submissions and evidence, concluded that the source of the cash deposits could not be doubted and thus deleted the addition.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 846493 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 1 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-03-2026
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Chandigarh
• Assessment Year: 2017-2018
• Appeal Filed On: 18-02-2025
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VIVEK VARDHAN LD.
• Assessee Lawyers: PARVEEN KUMAR BANSAL LD
• Keywords: Business income
• Section: 143(3)

Judgement Text

"1 IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, CHANDIGARH PHYSICAL HEARING BEFORE HON’BLE SHRI RAJPAL YADAV, VICE PRESIDENT AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकर अपील सं./ ITA No.254/CHANDI/2025 (िनधाŊरण वषŊ / Assessment Year: 2017-18) Shri Amar Singh Bindra 29/30, Parry Hotel, Bank Road Ambala Cantt. 133001 बनाम/ Vs. ITO Ward-1 Ambala ˕ायीलेखासं./जीआइआरसं./PAN/GIR No. AHKPB-1314-M (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/ Appellant by : Shri Parveen Kumar Bansal (Advocate) – Ld. DR ŮȑथŎकीओरसे/Respondent by : Shri Vivek Vardhan (Addl. CIT) – Ld. Sr. DR सुनवाईकीतारीख/Date of Hearing : 24-03-2026 घोषणाकीतारीख /Date of Pronouncement : 24-03-2026 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2017-18 arises out of an order of learned Commissioner of Income Tax (Appeals), NFAC [CIT(A)] dated 29-01-2025 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s 143(3) of the Act on 04-12-2019 making addition of cash deposit of Rs.54.10 Lacs in the hands of the assessee. The Ld. AR pressed only for quantum additions on merits as contained in ground nos. 1,2,3 & 7. Having heard rival Printed from counselvise.com 2 submissions and upon perusal of case records, our adjudication would be as under. 2. The assessee is stated to be engaged in selling fruits and vegetables. During assessment proceedings, it transpired that the assessee deposited cash of Rs.54.10 Lacs during demonetization period which were stated to be sourced out of cash sales. However, considering the facts that such deposit during corresponding period in earlier year was only Rs.24.20 Lacs, Ld. AO alleged that huge unaccounted cash was lying with the assessee which was given the shape of sales. Therefore, the amount of Rs.54.10 Lacs was added as business income of the assessee. 3. The Ld. CIT(A), vide para 5.3 of the impugned order, alleged that the assessee failed to provide corroborative evidence such as sales ledger or cash book. Therefore, the impugned addition was confirmed against which the assessee is in further appeal before us. 4. From submissions before us, it emerges that the assessee is engaged as commission agent for fruits and vegetables which is primarily cash driven market. The assessee is registered as an Arhtiya and fully regulated by Government in terms of sales and purchases. Upon receipt of stock from the farmers, the same is entered into Nilami register by an employee of Market Committee at the entry gate. When the stock is received in assessee’s premises, the same is entered in Lal Kitab as mandated by the Government. The assessee has thus carried out sale and purchase of fruits and vegetable products in regulated conditions. From assessee’s paper-book as placed on Printed from counselvise.com 3 record, it could further be seen that the assessee duly furnished bank certification for cash deposits along with details of cash sales during demonetization period (Page Nos. 105 to 116). The assessee also furnished cash book which is matching with the certified registers, ledger of Mall Khata, ledger of sales and purchases etc. (Page nos. 140 to 359 of the paper-book). The deposits in specified bank notes is only for Rs.28 Lacs which have been deposited on 12-11-2016 at one go. The assessee also furnished month-wise cash sales and closing balance of cash-in-hand as on 08-11-2016 which is Rs.55,23,715/- which has subsequently been deposited into bank account upon announcement of demonetization. The assessee submitted cash book for the relevant period to establish the sources of bank deposits. To further support his case during first appeal, the assessee duly filed certification of sales & commissions date-wise, a certificate from the marketing committee certifying the sales & commission as earned by the assessee along with audited financial statements. From the same, it could be seen that the assessee has carried out consignment sales of Rs.276.19 Lacs in AY 2016-17 and consignment sales of Rs.459.11 Lacs during this year. The commission earned on these sales form part of regular books of accounts which has duly been audited. No defect has been found in the books of the assessee and books have not been rejected. The assessee is regularly filing Income Tax return declaring business income. The only reason to reject the claim of the assessee by Ld. AO is that cash deposits in corresponding period of earlier year was much less than the cash deposit during demonetization period Printed from counselvise.com 4 which is clearly fallacious in nature. The same overlook the fact that there is substantial increase in consignment sales in this year. On these facts, the source of cash deposits by the assessee could not be doubted. Therefore, we find substantial merit in the argument of Ld. AR and accordingly, delete the impugned addition as made by Ld. AO. The assessee succeeds in its corresponding grounds of appeal. The Ld. AO is directed to re-compute the income of the assessee. 5. The appeal stand partly allowed. Order pronounced on 24th March, 2026. -Sd- -Sd- (RAJPAL YADAV) (MANOJ KUMAR AGGARWAL) VICE PRESIDENT ACCOUNTANT MEMBER AS Dated: 24-03-2026 आदेश की Ůितिलिप अŤेिषत /Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT CHANDIGARH Printed from counselvise.com "