SUBASHINI SOOD,SOUTH DELHI V. DCIT, NEW DELHI

ITA 4077/DEL/2025

AI Insights

The case involves Subashini Sood, who appealed against the order of the Ld. Addl/JCIT(A)-2 Noida, which sustained the addition of Rs. 11,47,000 to her income as unexplained investment under section 69A of the Income Tax Act. The addition was initially made by the Assessing Officer (AO) during scrutiny assessment, following the discovery of substantial cash deposits in Sood's bank account during the demonetization period in late 2016. The AO was not satisfied with Sood's explanation that the deposits were from past withdrawals kept at home for medical emergencies. The Tribunal, after considering the arguments and evidence, decided to reduce the addition significantly, acknowledging the lack of satisfactory explanation from the assessee while also not fully accepting the department's stance.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 793344 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Appeal Filed On: 25-06-2025
• Other Referred Cases: SMILE Microfinance Ltd. vs. ACIT
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MANOJ KUMAR
• Assessee Lawyers: AGNI CHOUDHARY; RAGHAV
• Keywords: Unexplained investment

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH “SMC’’ : NEW DELHI) BEFORE SHRI MAHAVIR SINGH, HON’BLE VICE PRESIDENT ITA No. 4077/Del/2025 Asstt. Year : 2017-18 Subashini Sood, vs. DCIT, NEW DELHI C-251, 6th floor, Defence Colony, New Delhi – 110 024 (PAN: AJSP8300A) (Appellant) (Respondent) Appellant by : Ms. Agni Choudhary, Adv. & Sh. Raghav Sharma, CA (Thru VC) & Sh. Rahul Agarwal, CA Respondent by : Shri Manoj Kumar, Sr. DR. Date of Hearing 04.09.2025 Date of Pronouncement 24.09.2025 ORDER This appeal by the assessee is emanating from the order of the Ld. Addl/JCIT(A)-2 Noida dated 05.10.2024 on the solitary ground relating to sustaining the addition of Rs. 11,47,000/- made by the AO u/s. 69A of the Act by treating the cash deposit as unexplained investment. 2. Brief facts of the case are that assessee filed her return of income on 23.10.2017, declaring a total income of Rs. 2,72,210/-. During the course of scrutiny assessment, the AO found that the assessee had deposited Rs. 11,47,000/- in her bank account during the demonetization period, specifically between Printed from counselvise.com 2 | P a g e November and December 2016. The AO, not being satisfied with the explanation provided regarding the source of cash deposits, treated the entire amount as unexplained money and added it to the total income of the assessee under section 69A of the Act. Consequently, the total income was enhanced to Rs. 14,19,210/-. and the same was taxed u/s. 115BBE @ 60%. However, in appeal, Ld. First Appellate Authority sustained the addition. Against the above, assessee appealed before the Tribunal. 3. After hearing both the sides and perusing the records, I note that it was contended that the cash deposits were made from past withdrawals specifically from the financial years 2012-13 and 2013-14, and that the money was kept at home for medical emergencies, given her age and health condition. The AO questioned the timing of the deposits. The cash was deposited on 17.12.2016, more than a month after demonization was announced. The AO argued that if the appellant indeed had such large cash reserves for emergencies, should have deposited the cash earlier, especially considering the urgency during the demonetization period. Additionally, the AO observed that the assessee made smaller withdrawals during the same period, which contradicted her claim of having substantial cash reserves. Ld. CIT(A), upheld the addition in dispute. However, it was the contention of the Assessee that assessee explained that the cash was accumulated from past withdrawals made in the earlier financial years, Printed from counselvise.com 3 | P a g e specifically from FY 2012-13 and FY 2013-14 and she kept the cash at home for medical emergencies, given her age and health condition as well as the fact that her sons lived abroad and advised her to maintain a reserve of cash for any unforeseen health related expenses. I have given my thoughtful consideration to the assessee’s contentions before the lower authorities and Revenue’s contention in support of the impugned addition. I find no reason to accept either parties stand in entirety. This is for the precise reason that neither the assessee has been able to properly explain the source of cash deposits nor the department could simply brush aside all the relevant evidence at one go. Be that as it may, the tribunal is of the considered view that in these peculiar facts, it is deemed appropriate in the larger interest of justice to confirm the impugned addition of Rs. 11,47,000/- to Rs. 47,000/- only with a rider that the same shall not be as a precedent. The assessee gets relief of Rs. 11,00,000/- in other words. Necessary computation shall follow as per law. 4. So far as assessee’s assessment u/s. 115 BBE of the Act is concerned, in view of Hon’ble Madras High Court in SMILE Microfinance Ltd. vs. ACIT in WP(MD) no. 2078 of 2020 & 1742 of 2020 dated 19.11.2024 (Mad.) has already settled the issue against the department that the law applies to the transaction on or after 01.04.2017 only. Printed from counselvise.com 4 | P a g e 5. The instant assesseee’s appeal is partly allowed in the aforesaid terms. Order pronounced on 24.09.2025. Sd/- (MAHAVIR SINGH) VICE PRESIDENT SR Bhatnagar Date: 24-09-2025 Copy forwarded to: - Copy forwarded to: - 1. Appellant 2. Respondent 3. DIT 4. CIT (A) 5. DR, ITAT Assistant Registrar, ITAT, Delhi Bench Printed from counselvise.com "