SAVITABEN NATHALAL VADI,JAMNAGAR V. INCOME TAX OFFICER, WARD 1(3), JAMNAGAR, JAMNAGAR

ITA 426/RJT/2025

AI Insights

The case involves Savitaben N. Vadi, who appealed against the order of the Commissioner of Income Tax (Appeals) which had set aside the addition of Rs. 2,50,000 made by the Assessing Officer under section 69A of the Income Tax Act, 1961. The addition was initially made following a cash deposit in the assessee's bank account during the demonetization period. The Tribunal examined whether the addition was justified and considered the CBDT's guidelines which provided a blanket exemption for small amounts deposited by individuals like artisans, housewives, and daily workers during the demonetization period. The Tribunal found that the assessee's case fell within these guidelines, leading to the deletion of the addition.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 775840 (ITAT-RAJKOT)
• Duration Of Justice: 2 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Appeal Filed On: 23-06-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Condonation of delay; Set aside; Competent authority; Recovery proceedings
• Section: 147; 144; 142(1); 139

Judgement Text

" आयकरअपीलीयअिधकरण IN THE INCOME TAX APPELLATE TRIBUNAL, “SMC” RAJKOT BENCH, RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER आयकरअपीलसं (Ǔनधा[रणवष[ Assessee by Respondent by Date of Hearing Date of Pronouncement Per, Dr. Arjun Lal Saini, AM: The present appeal has been filed by the Assessee, against the order passed by the Learned Commissioner of Income Tax (Appeal), Ahmedabad/ National Faceless Appeal, Centre (NFAC), Delhi dated [hereinafter referred to as “CIT(A)”]22.11.2024 arising in the matter of assessment order passed u/s. r.w.s. 144 of the Income Tax Act, 1961 (here relevant to the Assessment Year 20 2. Grounds of appeal raised by the assessee, are as follows: “Learned CIT(A) erred in law as well as on facts in setting aside an addition of Rs. 2,50,000/- u/s. 69A of the Act made by Ld. AO being entire cash deposited during SavitabenNathalal Vadi G-3, Manali Apartment Saruasaction Road, Jamnagar – 361001 èथायीलेखासं./जीआइआरसं./PAN/GIR No.: (अपीलाथȸ/Assessee) आयकरअपीलीयअिधकरण,राजकोटɊायपीठ,राजकोट। IN THE INCOME TAX APPELLATE TRIBUNAL, “SMC” RAJKOT BENCH, RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER आयकरअपीलसं./ITA No. 426/RJT/2025 Ǔनधा[रणवष[/Assessment Year: (2017-18) : Shri Chetan Agarwal Ld. AR : Shri Abhimanyu Singh Yadav, Ld. : 03/09/2025 Date of Pronouncement : 12/09/2025 ORDER . Arjun Lal Saini, AM: appeal has been filed by the Assessee, against the order passed by the Learned Commissioner of Income Tax (Appeal), Ahmedabad/ National Faceless Appeal, Centre (NFAC), Delhi dated [hereinafter referred to as arising in the matter of assessment order passed u/s. of the Income Tax Act, 1961 (here-in-after referred to as “the Act”) relevant to the Assessment Year 2017-18. Grounds of appeal raised by the assessee, are as follows: erred in law as well as on facts in setting aside an addition of Rs. u/s. 69A of the Act made by Ld. AO being entire cash deposited during ruasaction Vs. Income Tax Officer, wd – Jamnagar - 361001 PAN/GIR No.: ABDPV4944N (Ĥ×यथȸ/Respondent) 1 राजकोट। IN THE INCOME TAX APPELLATE TRIBUNAL, “SMC” BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER , Ld. Sr. DR appeal has been filed by the Assessee, against the order passed by the Learned Commissioner of Income Tax (Appeal), Ahmedabad/ National Faceless Appeal, Centre (NFAC), Delhi dated [hereinafter referred to as arising in the matter of assessment order passed u/s.147 after referred to as “the Act”) erred in law as well as on facts in setting aside an addition of Rs. u/s. 69A of the Act made by Ld. AO being entire cash deposited during – 1(3), Printed from counselvise.com ITA No. 426/Rjt/2025 Savitaben N. Vadi demonetization as an unexplained money without considering the fact of the case. he ought to have decided the issue himself. 3. The appeal filed by the assessee is barred by limitation by assessee moved a petition for condonation of delay, requesting the Bench to condoned the delay. The Ld. Counsel for the assessee women of 70 years old an CIT(A) and notices were not served on assessee came to know about she received notices from the Income Tax Department for after the assessee took immediate step this process, the delay of 153 days has caused, therefore Ld. Counsel delay should be condoned, in the interest of justice. 4. On the contrary, the Ld. Sr. DR for the revenue opposed the assessee to condone the delay and stated that delay should not be condoned on such reasons, as explained dismissed. 5. I have heard both the parties on this a senior citizen of 70 years old hearing were not issued by the Ld. CIT(A) order by the learned CIT (A) officer for recovery of tax.T the appeal before this Tribunal occurred. I have gone through the petition for condonation of delay, and the sufficient cause explained by the assessee, in the petition for condonation of delay, as reproduced above. The learned Counsel adverted condonation of delay and urged for a benign view and sought condonation of delay demonetization as an unexplained money without considering the fact of the case. he the issue himself.” The appeal filed by the assessee is barred by limitation by 153 days. The assessee moved a petition for condonation of delay, requesting the Bench to Ld. Counsel for the assessee submitted that assessee is nd she was not aware about passing the order of Ld. notices were not served on the assessee by the Ld. CIT(A). assessee came to know about passing the order by Ld. CIT(A),(ex-parte she received notices from the Income Tax Department for recovery immediate steps to file the appeal before this Tribunal. In this process, the delay of 153 days has caused, therefore Ld. Counsel in the interest of justice. . On the contrary, the Ld. Sr. DR for the revenue opposed the the delay and stated that delay should not be condoned on by the assessee, and appeal of the assessee should be . I have heard both the parties on this preliminary issue, I note that the assessee is 70 years old.During the appellate proceedings the notices by the Ld. CIT(A) and she came to know about passing the order by the learned CIT (A)when demand notice was issued by the assessing .Then after she immediately took necessary step to file the appeal before this Tribunal, and in this process the delay 153 days has have gone through the petition for condonation of delay, and the sufficient cause explained by the assessee, in the petition for condonation of delay, The learned Counsel adverted my attention to the reasons for condonation of delay and urged for a benign view and sought condonation of delay 2 demonetization as an unexplained money without considering the fact of the case. he 153 days. The assessee moved a petition for condonation of delay, requesting the Bench to that assessee is a d she was not aware about passing the order of Ld. by the Ld. CIT(A). The parte)only when recovery of tax. Then ile the appeal before this Tribunal. In this process, the delay of 153 days has caused, therefore Ld. Counsel prayed that . On the contrary, the Ld. Sr. DR for the revenue opposed the prayer of the the delay and stated that delay should not be condoned on ppeal of the assessee should be issue, I note that the assessee is uring the appellate proceedings the notices of about passing the by the assessing necessary step to file delay 153 days has have gone through the petition for condonation of delay, and the sufficient cause explained by the assessee, in the petition for condonation of delay, attention to the reasons for condonation of delay and urged for a benign view and sought condonation of delay Printed from counselvise.com ITA No. 426/Rjt/2025 Savitaben N. Vadi of 153 days in filing the appeal explained by the ld. Counsel for the assessee, gives of mitigating circumstances to enable assessee. Accordingly, the delay is condoned in filing the appeal 6. Brief facts qua issue are that the of income for the A. Y. 2017 1961. As per credible written information available with deposited cash of Rs. 2,50,000/ 30.12.2016 in her account held with Navanagar Co assessee has not filed return of income for AY 2017 above cash deposit of Rs. 2,50,000/ Therefore, the case of the assess 148 of the I. T. Act, 1961 was issued on 31.03.2021 after obtaining necessary approval from the competent authority. The assessee was required to file her return of income for the relevant period within 30 day income is filed. Subsequently, notice u/s 142(1) was issued on 15.11.2021 7. Therefore, Assessing offi cash deposit of Rs. 2,50,000/ with Navanagar Co-operative Bank Ltd.. Therefore, amount of Rs.2,50,000/ treated as unexplained and added to the total income u/s 69A of the I.T. Act for the year under consideration. 8. Aggrieved by the order of the assessing officer, the assessee carried the matter in appeal before the Ld. CIT(A), with the direction to the assessing officer for making fresh assessment. 9. Aggrieved by the order of the Ld. CIT(A) days in filing the appeal. A perusal of the reasons and sufficient cause explained by the ld. Counsel for the assessee, gives me an impression of existence of mitigating circumstances to enable me to exercise my discretion in favour of the assessee. Accordingly, the delay is condoned in filing the appeal. Brief facts qua issue are that the, in this case, the assessee did not file her of income for the A. Y. 2017-18 as per provisions of section 139 of the I.T. Act, 1961. As per credible written information available with AO, the assessee deposited cash of Rs. 2,50,000/- during demonetization period 09.11.2016 to in her account held with Navanagar Co-Op Bank Ltd.. However, assessee has not filed return of income for AY 2017-18 and therefore source of the above cash deposit of Rs. 2,50,000/- in the bank account remained unexplained. Therefore, the case of the assessee for AY 2017-18 was re-opened and notice u/s 148 of the I. T. Act, 1961 was issued on 31.03.2021 after obtaining necessary approval from the competent authority. The assessee was required to file her return of income for the relevant period within 30 days. However, no such return of . Subsequently, notice u/s 142(1) was issued on 15.11.2021 ficer noted that assessee failed to explain the source of cash deposit of Rs. 2,50,000/-(excluding interest credited) in her bank account held operative Bank Ltd.. Therefore, amount of Rs.2,50,000/ treated as unexplained and added to the total income u/s 69A of the I.T. Act for the . Aggrieved by the order of the assessing officer, the assessee carried the matter in appeal before the Ld. CIT(A), which has set aside the order of the assessing officer with the direction to the assessing officer for making fresh assessment. . Aggrieved by the order of the Ld. CIT(A), the assessee is in appeal before us. 3 A perusal of the reasons and sufficient cause sion of existence discretion in favour of the n this case, the assessee did not file her return 18 as per provisions of section 139 of the I.T. Act, , the assessee during demonetization period 09.11.2016 to Op Bank Ltd.. However, 18 and therefore source of the in the bank account remained unexplained. opened and notice u/s 148 of the I. T. Act, 1961 was issued on 31.03.2021 after obtaining necessary approval from the competent authority. The assessee was required to file her return s. However, no such return of . Subsequently, notice u/s 142(1) was issued on 15.11.2021. assessee failed to explain the source of her bank account held operative Bank Ltd.. Therefore, amount of Rs.2,50,000/- is treated as unexplained and added to the total income u/s 69A of the I.T. Act for the . Aggrieved by the order of the assessing officer, the assessee carried the matter in which has set aside the order of the assessing officer with the direction to the assessing officer for making fresh assessment. , the assessee is in appeal before us. Printed from counselvise.com ITA No. 426/Rjt/2025 Savitaben N. Vadi 10. I have heard both the parties and perused t the outset, the Ld. Counsel for the assessee of Rs. 2,50,000/- during the amount,which is not chargeable deposited 2,50,000/- in the demonetisation which is not chargeable to tax Ld. Counsel submitted that during the assessment proceedings submitted the required details and documents before the assessing officer, source of Rs.2,50,000/-, which wa did not take into account, the submission of the assessee contended that addition of Rs. 2,50,000/ 11. On the other hand, the Ld. Sr. DR for the revenue relied on the finding of the assessing officer. 12. I have heard both the p assessing officers as to how to examine of the case of cash deposit during the demonetization period and in said facts that there should be blanked exemption of Rs. 2 instruction No. 03/2017, dated 21/02/2017, w case of small assessee, like artisans, daily workers, housewives etc, then such small amount would not be questioned by 2,50,000/- per person. Taking into account, the facts narrate Instruction issued by the CBDT should be considered, vide Press Release dated 18.11.2016 and Guidelines for Verification of Cash deposit during demonetization to the AO vide Instruction No. 3/2017 21.2.2017 and annexure thereof issued under section 119 of Income Tax Act, I have heard both the parties and perused the material available on record. the outset, the Ld. Counsel for the assessee, submitted that assessee has deposited during the demonetarization period, which is the maximum chargeable to tax, as per the CBDT Circular. The assessee has demonetisation period, which is the maximum amount to tax, hence should not be subject to addition Ld. Counsel submitted that during the assessment proceedings, the details and documents before the assessing officer, , which was deposited in the bank account. the submission of the assessee, therefore, Ld. Counsel hat addition of Rs. 2,50,000/- should be deleted. , the Ld. Sr. DR for the revenue relied on the finding of the parties. I find that CBDT has issued instruction how to examine of the case of cash deposit during the demonetization period and in said circular the CBDT has explained and narrated facts that there should be blanked exemption of Rs. 2,50,000/- per person dated 21/02/2017, wherein CBDT has explained that in like artisans, daily workers, housewives, and small such small amount would not be questioned by the Ld. Taking into account, the facts narrated above, Instruction issued by the CBDT should be considered, vide Press Release dated 18.11.2016 and Guidelines for Verification of Cash deposit during demonetization to the AO vide Instruction No. 3/2017 [F.NO. 225/100/2017/ITA 2.2017 and annexure thereof issued under section 119 of Income Tax Act, 4 he material available on record.At submitted that assessee has deposited period, which is the maximum he assessee has maximum amount, should not be subject to addition. Besides, the , the assessee has details and documents before the assessing officer, and However, AO herefore, Ld. Counsel , the Ld. Sr. DR for the revenue relied on the finding of the CBDT has issued instruction,to the how to examine of the case of cash deposit during the CBDT has explained and narrated per person, vide herein CBDT has explained that in , and small assessee AO up to Rs. d above, I note that Instruction issued by the CBDT should be considered, vide Press Release dated 18.11.2016 and Guidelines for Verification of Cash deposit during demonetization F.NO. 225/100/2017/ITA-II] dated 2.2017 and annexure thereof issued under section 119 of Income Tax Act, Printed from counselvise.com ITA No. 426/Rjt/2025 Savitaben N. Vadi which are discussing and providing a blanket exemption of Rs. 2,50,000/ person. In the Press release dated 18.11.2016 also, it was stated that: “It was announced by the Government artisans, workers, housewives, etc. would not be questioned by the Income Tax Department in view of the fact that present exemption limit for Income Tax is Rs.2.5 lakh”. 13. I note that assessee`s case was re u/s. 148 of the Act dated 31.03.2021 on the basis of the information that had deposited total cash of Rs.2,50,000/ demonetizationperiod. The Assessmen Act by making addition of Rs. 2,50,000/ that addition made by the assessing officer in the hands of the assessee of Rs. 2,50,000/- which is maximum amount under consideration has not filed Return of Income in the category of maximum amount which is slab), as noted in CBDT circ pay the tax. Therefore, I delete the addition. 14. In the result, the appeal of the assessee is allowed. Order is pronounced in the open court on राजकोट/Rajkot िदनांक/ Date: 12/09/2025 Copy of the order forwarded to : The assessee The Respondent and providing a blanket exemption of Rs. 2,50,000/ person. In the Press release dated 18.11.2016 also, it was stated that: “It was announced by the Government earlier that small deposits made in the banks by artisans, workers, housewives, etc. would not be questioned by the Income Tax Department in view of the fact that present exemption limit for Income Tax is Rs.2.5 case was re-opened u/s. 147 of the Act, by issuing notice u/s. 148 of the Act dated 31.03.2021 on the basis of the information that had deposited total cash of Rs.2,50,000/- in her Nawanagar Co-op. Bank during Assessment order was framed u/s. 147 r.w.s. 144 of the ct by making addition of Rs. 2,50,000/- u/s. 69A, as unexplained money. that addition made by the assessing officer in the hands of the assessee of Rs. which is maximum amount, which is not chargeable to tax. The assessee under consideration has not filed Return of Income.I note that Rs. 2,50,000/ in the category of maximum amount which is not chargeable to Tax ( cular, in above Para, hence, the assessee re, I delete the addition. In the result, the appeal of the assessee is allowed. Order is pronounced in the open court on 12/09/2025. Sd/- (DR. ARJUNLAL SAINI) ACCOUNTANT M (True Copy) 5 and providing a blanket exemption of Rs. 2,50,000/- per earlier that small deposits made in the banks by artisans, workers, housewives, etc. would not be questioned by the Income Tax Department in view of the fact that present exemption limit for Income Tax is Rs.2.5 by issuing notice u/s. 148 of the Act dated 31.03.2021 on the basis of the information that assessee op. Bank during framed u/s. 147 r.w.s. 144 of the as unexplained money.I note that addition made by the assessing officer in the hands of the assessee of Rs. argeable to tax. The assessee I note that Rs. 2,50,000/- falls not chargeable to Tax ( exempted hence, the assessee is not liable to (DR. ARJUNLAL SAINI) CCOUNTANT MEMBER Printed from counselvise.com ITA No. 426/Rjt/2025 Savitaben N. Vadi CIT The CIT(A) DR, ITAT, RAJKOT Guard File /True copy/ By order Assistant Registrar/Sr. PS/PS ITAT, Rajkot 6 Assistant Registrar/Sr. PS/PS Printed from counselvise.com "