2023 (3) TMI 213 - AT - Income Tax

Addition u/s 115BBE - cash has been deposited out of unexplained sources - AR submitted that the section 115BBE is not a charging section but this section simply provides mechanism for levying of tax in a case there is addition made u/s. 68, 69, 69A, 69B, 69C and 69D - HELD THAT:- AO has not mention any section under which additions have been in the hands of assessee and he merely mentioned that the cash has been deposited out of unexplained sources and same is added to the return income of assessee in terms of section 115BBE of the Act.

Further from the careful reading of findings recorded by the Ld. CIT(A) in para 5 it is also clear that the Ld. CIT(A) has not mentioned any section under which the addition has been confirmed - As decided in SMT. SUDHA LOYALKA, C/O M/S RRA TAXINDIA [2018 (7) TMI 1892 - ITAT DELHI]non-mentioning the precise provision of law makes the impugned addition bad in law.

Cash deposit during demonetization - HELD THAT:- Undisputedly there was a opening cash of Rs. 2,74,580/- as on 01.04.2016, the assessee received rent of Rs. 3,20,000/-, tuition fee of Rs. 1,20,100/- and there were bank withdrawals of Rs. 5,54,000/- up to demonetization i.e. 25.11.2016. The said amounts comes to Rs. 12,68,680/- and the amount deposited by the assessee during pre-demonetization and during demonetization period was Rs. 12,10,000/- leaving the cash balance of Rs. 58,680/- as on 25.11.2016. These facts have not been controverted by the Ld. Senior Departmental Representative in any manner. Therefore in my consider opinion the addition of Rs. 7 lakh confirm by the CIT(A) is not sustainable under the said facts and circumstances as the assessee has successfully demonstrated the source of cash deposited by her to her bank account. Therefore the grounds of assessee on merits are allowed and AO is directed to delete the addition.