BALU VIGNESH,DHARMAPURI V. ACI, CIRCLE-1(1), HOSUR

ITA 1605/CHNY/2024

AI Insights

The case involves an appeal by Shri Balu Vignesh against the order of the Commissioner of Income Tax (Appeals), which confirmed the addition of Rs.53.23 Lacs as unexplained money during the demonetization period in India. The Assessing Officer had initially made this addition, questioning the source of cash deposits made by the assessee post-demonetization. The Tribunal found that the assessee had sufficient cash balance, evidenced by an audited cash book, to cover the deposits and criticized the Assessing Officer for arbitrarily accepting part of the source while rejecting the rest without legal basis.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 472453 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-11-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 17-10-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 27-05-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M. KARTHIKEYAN LD
• Assessee Lawyers: D. ANAND LD
• Section: 143(3); 69A; 44AB

Judgement Text

" आयकर अपीलीय अिधकरण ‘ए’ \u0010ा यपीठ चे\u0015ई म\u0018। IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, CHENNAI मा ननीय +ी मनोज क ुमा र अ/वा ल ,लेखा सद4 एवं मा ननीय +ी मनु क ुमा र िग7र, \u0010ा ियक सद4 क े सम8। BEFORE HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM AND HON’BLE SHRI MANU KUMAR GIRI, JM आयकरअपील सं ./ ITA No.1605/Chny/2024 (िनधा 9रणवष9 / Assessment Year: 2017-18) Shri Balu Vignesh #33, Appavu Nagar, Dharmapuri-636 701. बना म/ Vs. ACIT Circle-1(1) Hosur. \u0001थायीलेखासं./जीआइआरसं./PAN/GIR No. AISPV-7755-P (अपीलाथ\u001c/Appellant) : (\u001f थ\u001c / Respondent) अपीलाथ\u001c कीओरसे/ Appellant by : Shri D. Anand (Advocate) - Ld.AR \u001f थ\u001cकीओरसे/Respondent by : Shri M. Karthikeyan (Addl.CIT) - Ld. DR सुनवाई की तारीख/Date of Hearing : 17-10-2024 घोषणा की तारीख /Date of Pronouncement : 05-11-2024 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 the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 28-03-2024 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 143(3) of the Act on 30-12-2019. 2. In the assessment order, Ld. AO has made addition of Rs.53.23 Lacs as unexplained money u/s. 69A r.w.s 115BBE which represents cash deposits by the assessee during demonetization period from 09-11- 2 2016 to 30-12-2016. The Ld. CIT(A) confirmed the impugned addition by observing that the assessee failed to furnish supporting documents during appellate proceedings. Aggrieved, the assessee is in further appeal before us. 3. The Ld. AR has submitted that the assessee has huge turnover and it had sufficient cash balance as on 08-11-2016 to make the impugned deposits. The copy of cash book for the month of November, 2016 has also been placed on record to substantiate the same. The Ld. Sr. DR supported the orders of lower authorities. Having heard rival submissions and upon perusal of case records, our adjudication would be as under. 4. From assessment order, it is clear that the assessee is engaged in textile business under proprietary concern namely Shri Krishna Silks. The assessee has shown turnover of Rs.25.77 Crores and its books of accounts are duly audited u/s 44AB. The assessee deposited cash of Rs.133.73 Lacs in 3 bank accounts during demonetization period which are tabulated in para 3 of the assessment order. As per cash book, cash balance as on 08-11-2016 was Rs.169.57 Lacs which was stated to be the source of these deposits. The Ld. AO accepted the source of cash of Rs.80.50 Lacs which was deposited up-to 15-11-2016 but rejected the source of cash deposits for Rs.53.23 Lacs which was deposited from 16- 11-2016 onwards on the ground that the assessee should have deposited entire amount within a reasonable period of time. Therefore, the amount of Rs.53.23 Lacs was added u/s 69A r.w.s.115BBE. The Ld. CIT(A) upheld the same against which the assessee is in further appeal before us. 3 5. The undisputed fact that emerges is that the assessee is holding cash balance of Rs.133.73 Lacs as on 08-11-2016 which is duly evidenced by its cash book. The books of the assessee have duly been audited u/s 44AB and no defect has been observed in the same. The assessee is engaged in trading activity and achieved turnover of Rs.24.77 Crores. The Ld. AO, in an arbitrary manner, accepted part of the source and rejected the other part whereas all the deposits has same source. The only reasoning is that the assessee should have deposited entire cash within a reasonable period of time which is not mandated by any law. Therefore, we delete the impugned addition and direct Ld. AO to re-compute the income of the assessee. 6. The appeal stand allowed. Order pronounced on 5th November, 2024 Sd/- (MANU KUMAR GIRI) \u0010ा ियक सद4 / JUDICIAL MEMBER Sd/- (MANOJ KUMAR AGGARWAL) लेखा सद4 / ACCOUNTANT MEMBER चे4ई Chennai; िदनांक Dated : 05-11-2024 DS आदेशकीNितिलिपअ/ेिषत/Copy of the Order forwarded to : 1. अपीलाथ\u001c/Appellant 2. \u001f थ\u001c/Respondent 3. आयकरआयु=/CIT Salem 4. िवभागीय\u001fितिनिध/DR 5. गाडBफाईल/GF "