TMI Blog2023 (3) TMI 314X X X X Extracts X X X X X X X X Extracts X X X X ..... nd levied tax u/s. 115BBE when the assessee has explained source for said cash deposits. CIT(A), without considering relevant facts simply sustained additions made by the AO. Thus, we direct the AO to delete additions made towards cash deposits u/s. 69A of the Act. Appeal filed by the assessee is allowed. - ITA No. 280/Chny/2022 - - - Dated:- 22-2-2023 - SHRI V. DURGA RAO , HON BLE JUDICIAL MEMBER AND SHRI G. MANJUNATHA , HON BLE ACCOUNTANT MEMBER For the Appellant : Shri. S. Sridhar , Advocate ( Erode ) For the Respondent : Shri. D. Hema Bhupal , JCIT ORDER PER G. MANJUNATHA , ACCOUNTANT MEMBER : This appeal filed by the assessee is directed against the order passed by the Commissioner of Income Tax, National Faceless Appeal Centre (NFAC), Delhi, dated 11.03.2022 and pertains to assessment year 2017-18. 2. The assessee has raised the following grounds of appeal: 1] The Learned Assistant Commissioner of National Faceless Appeal Centre, Delhi is not justified in confirming the Addition of Rs.37,34,000/made U/s.69A of the Act by D.C.1.T/CIRCLE-1/SALEM/TAMIL NADU. 2] The Appellant is maintaining Books of Accounts wherein the Labour Charges ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Appellate order the Appellate Authorities are discussing about the Cash summery filed for the Month of November 2016 October 2016 which are as Under:- Month Realization of Sundry Debtors October 2016 Rs. l, 7 4,58,027 November 2016 Rs. 1,22,90,526 10] When the appellant was able to produce the cash book wherein there are realization of Sundry Debtors as per the figures mentioned above the possibility of deposit of Rs.37,34,000/- out of the realization from Sundry debtors cannot be dis-believed. 11] After the announcement of the demonetization on 08.11.2016 when the outstanding debtors insisted for accepting the Cash given by them, the Appellant could not negative the same. When the Debtors re-paying in old currencies are not accepted by Appellant he was likely to loose the entire capital amount and hence he was forced to accept the demonetized currencies which were deposited in the Bank account during the period from 28.11.2016 to 28.12.2016, since the Government itself allowed time upto 31.12.2016 for depositing the SBN cu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he AO noticed that the assessee had made total cash deposits of Rs. 34 lakhs after demonetization in specified bank notes to his bank account maintained with Tamilnadu Mercantile Bank with account no. 028100050300170. The AO, called upon the assessee to explain source of cash deposits, for which the assessee filed a written submission and argued that source of cash deposits is out of realization of sundry advances of earlier years, for which the assessee has filed necessary evidences including financial statements along with ITR filed for earlier financial years. The AO, however was not convinced with the explanation furnished by the assessee. According to the Assessing Officer, the assessee could not satisfactorily explain source for cash deposits, although claims to have realized sundry advances appearing in the balance sheet. The AO has discussed the issue in light of decision of Hon ble Supreme Court in the case of Smt Srilekha Banerjee and others vs CIT, Bihar Orissa reported in 1964 AIR 697, and argued that when the Government has withdrawn legal tender of specified bank notes of Rs. 500/- Rs. 1000/-, then the assessee accepting said notes from his customers and depositin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Ld. Counsel for the assessee, submitted that the ld. CIT(A) erred in sustaining additions made towards cash deposits inspite of fact that the assessee has explained source for cash deposits and also filed necessary evidences. He further submitted that, as per the specified bank notes (cessation of liability) Act, 2017, which comes into effect from 31.12.2016, no person is allowed in dealing with specified bank notes on or after 31.12.2016. Therefore, the AO cannot treat cash deposits as unexplained money, just because the assessee has received cash in specified bank noted after 8th November, 2016. In this case, he relied upon the decision of ITAT, Chennai in the case of M/s. Umamaheswari vs ITO in ITA No. 527/Chny/2022 dated 14.10.2022. 6. The ld. DR, on the other hand supporting the order of the CIT(A) submitted that, the assessee has failed to follow guidelines issued by the Government and RBI from time to time to deal with specified bank notes. Further, the assessee could not satisfactorily explain source for cash deposits, although he claims to have realized sundry advances appearing in balance sheet. Therefore, the AO and CIT(A) has rightly sustained additions made toward ..... X X X X Extracts X X X X X X X X Extracts X X X X
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