SREE MANGOTTU KAVU DEVASWOM,PALAKKAD V. INCOME TAX OFFICER, PALAKKAD

ITA 263/COCH/2025

AI Insights

The case involves Sree Mangottu Kavu Devaswom, a trust managing an ancient temple under the Malabar Devaswom Board, which appealed against the assessment order by the Income Tax Officer, Ward-5, Palakkad. The AO had assessed the trust's income for the year 2017-2018, including a cash deposit of Rs.1,45,000 made in specified bank notes during the demonetization period, categorizing it as unexplained income. The trust contended that the deposit was from 'vazhipadu' collections, a claim initially not substantiated by documentary evidence, leading to the AO's addition of the amount to the taxable income. The CIT(A) upheld the AO's decision, prompting the trust to appeal to the Tribunal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 314220 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LEENA LAL; SENIOR
• Assessee Lawyers: B. MOHAN

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, COCHIN Before Shri Inturi Rama Rao, Accountant Member ITA No.263/Coch/2025 : Asst.Year 2017-2018 Sree Mangottu Kavu Devaswom Athipotta Post Alathur, Palakkad – 678 544. PAN : AAITS5711J. v. The Income Tax Officer Ward 5 Palakkad. (Appellant) (Respondent) Appellant by : Sri.B.Mohan, CA Respondent by : Smt.Leena Lal, Senior AR Date of Hearing : 05.05.2025 Date of Pronouncement : 08.05.2025 O R D E R This appeal filed by the assessee is directed against the order of the Addl. / Joint Commissioner of Income-tax (Appeals) [“Addl.CIT(A)” for short] dated 24.02.2025 for the assessment year 2017-2018. 2. Briefly, the facts of the case are that the appellant is a trust, running an ancient temple coming under the Malabar Devaswom Board of State Government of Kerala. The appellant filed the return of income for the assessment year 2017-2018 disclosing Nil income on 30th March, 2019. Against the said return of income, the assessment was completed by the Income-tax Officer, Ward-5, Palakkad (hereinafter “the AO”) vide order dated 10th December, 2019, passed u/s.143(3) of the Income-tax Act, 1961 (hereinafter “the Act”) at a total income of Rs.1,45,000. While doing so, the AO brought to tax the cash deposits ITA No.263/Coch/2025. Shree Mangottu Kavu Devaswom. 2 made in specified bank notes during the demonetization period, being the amount of vazhipadu collections, for failure of the appellant to produce documentary evidences to substantiate its claim. 3. Being aggrieved by the above assessment order, the appellant filed an appeal before the CIT(A), who vide the impugned order, confirmed the action of the AO by holding that the said amount was not reflected in the closing balance as on 08.11.2016. 4. Being aggrieved, the appellant is in appeal before the Tribunal, in the present appeal. 5. The learned Senior DR relied upon the orders of the authorities below. 6. I heard the rival submissions and perused the material available on record. The solitary issue that arises for my consideration is whether the AO was justified in making addition of cash deposit made in specified bank notes during the demonetization period amounting to Rs.1,45,000, rejecting the contention of the appellant that the source of the said deposit was from vazhipadu collection. On a mere perusal of the assessment order, it would be clear that the AO made an addition for the alleged failure of the appellant to prove the explanation with documentary evidences. I am of the opinion that having regard to the explanation filed before the lower authorities, it is a plausible explanation and cannot be rejected. Accordingly, I direct the AO to delete the addition. ITA No.263/Coch/2025. Shree Mangottu Kavu Devaswom. 3 7. In the result, the appeal filed by the assessee is allowed. Order pronounced on this 08th day of May, 2025. Sd/- (Inturi Rama Rao) ACCOUNTANT MEMBER Cochin; Dated : 08th May, 2025. Devadas G* Copy to : 1. The Appellant. 2. The Respondent. 3. The CIT, Cochin. 4. The DR, ITAT, Cochin. 5. Guard File. Asst.Registrar/ITAT, Cochin "