INCOME TAX OFFICER, DELHI V. ATUL AGGARWAL, DELHI

ITA 3916/DEL/2024

AI Insights

The case involves an appeal by the Income Tax Officer against the decision of the CIT(A), which had favored the Assessee, Atul Aggarwal, regarding the addition of Rs. 1,89,98,000 as unexplained cash deposit under section 68 of the Income Tax Act, 1961. The Assessee had filed his income tax return for the Assessment Year 2017-18, declaring an income of Rs. 71,490. His case was selected for scrutiny, and during the demonetization period, a substantial amount of cash was deposited in his bank account. The Assessing Officer (A.O.) treated these deposits as unexplained due to lack of response from the bank to a notice under section 133(6) and added the amount to the Assessee's income. However, the CIT(A) reversed this decision, leading to the Revenue's appeal to the Tribunal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 705926 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-07-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AJAY KUMAR ARORA
• Keywords: Set aside
• Section: 68; 133(6)

Judgement Text

" 1 ITA No. 3916/Del/2024 ITO Vs. Atul Aggarwal IN THE INCOME TAX APPELLATE TRIBUNAL DELHI (DELHI BENCH ‘A’ NEW DELHI) BEFORE SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER AND SHRI AVDHESH KUMAR MISHRA, ACCOUNTANT MEMBER ITA No. 3916/Del/2024 (A.Y. 2017-18) Income Tax Officer Room No. 2609, E-II, Block, Civic Centre, Minto Road, New Delhi Vs. Atul Aggarwal B-56, Molarband Village, Badarpur, New Delhi PAN: ABZPA2756K Appellant Respondent Assessee by None Revenue by Sh. Ajay Kumar Arora, Sr. DR Date of Hearing 03/07/2025 Date of Pronouncement 04/07/2025 ORDER PER YOGESH KUMAR, U.S. JM: The present appeal is filed by the Assessee against the order of Ld. Commissioner of Income Tax (Appeals)/ National Faceless Appeal Centre (‘NFAC’ for short), New Delhi dated 02/07/2024pertaining to Assessment Year 2017-18. 2. Brief facts of the case are that, the Assessee filed return of income atRs. 71,490/-. The case of the Assessee was selected for scrutiny in the ‘limited category’. Subsequently, notice u/s 143 of the Income Tax Act, 1961 ('Act' for short) was issued and served upon the Assessee. An assessment order came to be passed on 27/12/2019 by making an addition of Rs. 1,89,98,000/- u/s 68 of the Act on account 2 ITA No. 3916/Del/2024 ITO Vs. Atul Aggarwal of unexplained deposit of cash. Aggrieved by the assessment order dated 27/12/2019, the Assessee preferred an appeal before the CIT (A). The Ld. CIT(A) vide order dated 02/07/2024, allowed the Appeal of the Assessee. As against the order of the Ld. CIT(A), the Department preferred the present Appeal. 3. The Ld. Departmental Representative vehemently submitted that the Ld. CIT(A) committed error in deleting the addition without examining the fact as to whether the Assessee is authorized to accept the Specified Bank Notes during the demonization period or not. Further submitted that, though the bank has not responded to the notice u/s 133(6) of the Act during the assessment proceedings, the Ld. CIT(A) has deleted the addition which erroneous and the order of the Ld. CIT(A) requires to be set aside by the Tribunal. 4. None appeared for the Assessee. Considering the issue involved in the present Appeal, we deem it fit to decide the Appeal on hearing the Ld. Departmental Representative and verifying the material available on record. 5.We have heard the Ld. Departmental Representative and perused the material available on record. The Ld. A.O. on examination of ITR of the Assessee for Assessment Year 2017-18, observed that the Assessee deposited cash of Rs. 1,89,98,000/-during the demonization 3 ITA No. 3916/Del/2024 ITO Vs. Atul Aggarwal period i.e. 09/11/2016 to 30/12/2016 in his bank account maintained at Punjab National Bank. The A.O. issued notice u/s 133(6) of the Act to the Punjab National Bank which confirmed that the Assessee was itsBusiness Corresponding Agent. However, no reply was received by the A.O. in respect of acceptance of ‘Special Banking Notes’. Therefore, the cash deposited in the accounts of the Assessee has been treated as unexplained and made addition u/s 68 of the Act and made addition in the hands of the Assessee. 6. During the first appellateproceedings, the Assessee submitted the certificate issued by the concerned branch of the bank, wherein it was mentioned that the Assessee was the Business Corresponding Agent of the bank and the concerned account wherein the cash was deposited was a BCA. Further, Assessee has also produced ‘Memorandum of Understanding’entered into by the Assessee and the bank to prove that the Assessee was a Banking Corresponding Agent working for Punjab National Bank and the cash deposits on the account was on behalf of the bank. 7. It is a matter of fact that during the assessment proceedings, the concerned bank has not responded to the noticeissued u/s 133(6) of the Act, however during the appellate proceedings the Assessee has produced certificate issued by the bank confirming that the Assessee was the Business Correspondence Agent of the bank and also 4 ITA No. 3916/Del/2024 ITO Vs. Atul Aggarwal produced the MOU to prove that the Assessee was a BankingCorresponding Agent working for Punjab National Bank and the cash deposits on that account was on behalf of the bank. Merely because the bank has not responded to the notice issued u/s 133(6) of the Act in the manner the A.O. expected cannot be a basis for making the additions in the hands of the Assessee when the Assessee has produced cogent documents in support of his claim. Even the Department has not brought anything on record to prove that the document so relied by the Assessee during the first appellate proceedings are not genuine. Therefore, we find no error or infirmity in the order of the Ld. CIT(A) in deleting the addition. Accordingly,finding no merits in the grounds of Appeal of the Revenue, the Grounds of Appeal of the Revenue are dismissed. 8. In the result, the Appeal of the Revenue is dismissed. Order pronounced in the open court on 04th JULY , 2025 Sd/- Sd/- (AVDHESH KUMAR MISHRA) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Date:- 04 .07.2025 R.N, Sr.P.S* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "