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2022 (9) TMI 1183 - AT - Income TaxAddition made being Specified Bank Notes deposited in the bank account of the assessee - whether the assessee had sufficient cash balance in its books for making the said deposits in the bank account? - HELD THAT:- We find from the perusal of the bank statements for the whole year and the cash book for the whole year which is already forming part of records, the assessee has regularly withdrawn cash from its bank account throughout the year and has been making deposits in bank throughout the year in the bank account. Since remaining balance of the amounts withdrawn from bank after meeting its business expenses that were lying with the assessee had lost its validity of being classified as a legal tender pursuant to announcement of demonetisation policy by the Government of India, the assessee had no choice but to deposit the cash available with it both in the form of cash surplus withdrawals and also the cash received from customers in the designated bank account in Specified Bank Notes during the period 09/11/2016 to 31/12/2016. Out of these parties, 11 parties were selected by the AO for verifying the genuineness of the transaction. Three parties directly appeared before the ld. AO and filed the replies. Eight parties furnished the replies to the assessee and those replies were also submitted by the assessee before the ld. AO. These facts were not controverted by the Revenue before us by bringing any contrary evidences. AO had not brought any cogent evidence on record to disbelieve the details furnished by the parties and the assessee. The banks had fixed the maximum limit of making deposit in cash up to Rs.5,00,000/- in a day during the demonetization period commencing from 09/11/2016 to 31/12/2016. This had mandated the assessee to make frequent cash deposits less than Rs.5,00,000/- during the period 09/11/2016 to 31/12/2016. Accordingly, we hold that the entire cash deposits made by the assessee during the period 09/11/2016 to 31/12/2016 in Specified Bank Notes stood properly explained by the availability of cash balance in its books and hence, no addition thereon could be made u/s.68. Disallowance of depreciation of immovable property - HELD THAT:- As it could be seen that the sale deed has been registered in the name of the assessee before six months from the date of execution of the agreement, hence, effectively the ownership relates back to the date of agreement to the assessee. It is not in dispute that assessee was enjoying the physical possession of the property even prior to the date of agreement as a licensor. Pursuant to entering the agreement the assessee became the beneficial owner of the said property. We have no hesitation in placing reliance on the decision in the case of Mysore Minerals Ltd.[1999 (9) TMI 1 - SUPREME COURT] wherein it was held that when assessee was in possession of the property exercising and having right to use and occupy property he would be construed as the owner of the building though a formal deed of title could not have been executed and registered by taking possession of the property and making part payment thereon. It was held by the Hon’ble Supreme Court that depreciation u/s.32 of the Act would be eligible to the assessee. Disallowance of donation paid u/s.80G - Claim disallowed by AO as receipts were not submitted by the assessee - HELD THAT:- We find that assessee even before the AO had only sought for grant of deduction u/s.80G for Rs.65,000/- in respect of donations paid to The Saved Pearl Foundation on 10/10/2016 and 24/05/2016 amounting to Rs.32,500/- each. We find that the receipts for these two donations - Hence, we direct the ld. AO to verify the veracity of these two receipts and grant deduction u/s.80G of the Act to the assessee in accordance with law. In any case for the remaining sum of Rs.19,315/-, the assessee is not seeking any relief u/s.80G. Accordingly, the ground No.4 raised by the assessee is partly allowed for statistical purposes.
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