M/S HIRA LALL & SON (EXPORTS) (P) LTD.,DELHI V. INCOME TAX OFFICER , DELHI

ITA 4581/DEL/2025

AI Insights

The case involves M/s Hira Lall & Sons (Exports) (P) Ltd., which appealed against the order of the CIT(A)/ NFAC, Delhi, concerning the assessment year 2017-18. The primary issue was the treatment of cash deposits amounting to Rs. 32.86 lakhs during the demonetization period, which were deemed unexplained under section 68 read with section 115BBE of the Income-tax Act, 1961. The assessee argued that these deposits were from cash sales in regular business activities, supported by their balance sheets and books of account. However, they failed to provide sufficient evidence to the lower authorities. The Tribunal, considering the circumstances and the legal provisions, reduced the unexplained amount to Rs. 4,00,000 and directed the reassessment under normal provisions instead of section 115BBE.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 780233 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-10-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Appeal Filed On: 25-07-2025
• Other Referred Cases: SMILE Microfinance Ltd. v. ACIT in WP(MD) No. 2078 of 2020 & 1742 of 2020
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Section: 143(3); 68

Judgement Text

"1 ITA No. 4581/Del/2025 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘SMC’ NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER ITA No. 4581/Del/2025 Assessment Year: 2017-18 M/s Hira Lall & Sons (Exports) (P) Ltd., 20, East Park Area, Karol Bagh, New Delhi-110005. PAN: AAACH 0352 H Vs Income Tax Officer, Ward-11(3), Delhi. APPELLANT RESPONDENT Assessee represented by Sh. Somil Agarwal, Adv. & Ms. Shilpa gupta, CA Department represented by Ms. Ambika Agarwal, Sr. DR Date of hearing 06.10.2025 Date of pronouncement 06.10.2025 O R D E R PER SATBEER SINGH GODARA, JM: This assessee’s appeal ITA no. 4581/Del/2025 for assessment year 2017-18 arises against CIT(A)/ NFAC, Delhi’s order dated 23.06.2025 (DIN & Order No. ITBA/NFAC/S/250/2025-26/1077407293(1), in proceedings u/s 143(3) of the Income-tax Act, 1961, hereinafter referred to as the ‘Act’. Heard both the parties. Case file perused. 2. It emerges during the course of hearing with the able assistance coming from both the parties that learned lower authorities have treated the assessee’s cash deposits during demonetization amounting to Rs. 32.86 lakhs as unexplained u/s 68 Printed from counselvise.com 2 ITA No. 4581/Del/2025 read with section 115BBE of the Act in assessment order dated 30.12.2019, as upheld in the lower appellate proceedings. 3. That being the case, learned counsel invites the tribunal’s attention to the assessee’s detailed paper book indicating it as an exporter all along for the past so many assessment years in light of corresponding balance sheet and books of account etc. His case is that cash deposits all along represent assessee’s cash sales in regular business activity which has been wrongly treated as unexplained. The fact, however, remains that assessee has not been able to plead and prove all the necessary relevant facts and verification thereof before the learned lower authorities. I further find no merit in the Revenue’s vehement contention that cash deposit ought to be added in entirety in light of assessee’s supportive evidence. That being the factual position, it is thus deemed just and proper in the larger interest of justice that a lump sum addition of Rs. 4,00,000/- only would be just and proper. The assessee gets relief of Rs. 28.86 lakhs in other words. Ordered accordingly. 4. So far as the assessee’s assessment u/s 115BBE is concerned, the revenue could hardly dispute that hon’ble Madras high court in SMILE Microfinance Ltd. v. ACIT in WP(MD) No. 2078 of 2020 & 1742 of 2020 dated 19.11.2024 (Mad.) has already settled the issue that Section 115BBE applies on transactions on or Printed from counselvise.com 3 ITA No. 4581/Del/2025 after 01.04.2017 only. I, accordingly direct the Assessing Officer to finalize the consequential computation under normal provisions than u/s 115BBE of the Act in very terms. Ordered accordingly. 5. This assessee’s appeal is partly allowed in very terms. Order pronounced in open court on 06.10.2025. Sd/- (SATBEER SINGH GODARA) JUDICIAL MEMBER Dated: 13.10.2025. *MP* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "