TMI Blog2023 (6) TMI 770X X X X Extracts X X X X X X X X Extracts X X X X ..... s partly allowed. Taxability of addition under amended provisions of Section 115BBE of the Act at the higher rate - Division Bench of Jabalpur Tribunal in ACIT Vs Sandesh Kumar Jain [ 2022 (11) TMI 126 - ITAT JABALPUR] held that the amended provisions to take effect from 15/12/2016 itself so impliedly effective from 01/04/2017 i.e. for A.Y. 2018-19. Direct AO to tax the additions at the old rate of tax prescribed u/s 115BBE i.e. prior to amendment applicable w.e.f. 15/12/2016. Grounds No. 2 and 3 of the appeal are allowed. - ITA No. 245/Srt/2021 - - - Dated:- 15-6-2023 - Shri Pawan Singh, Judicial Member For the Assessee : Ms. Chaitali Shah, CA For the Department : Shri Vinod Kumar, Sr. DR ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER: PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by the assessee is directed against the order of learned National Faceless Appeal Centre, Delhi (NFAC)/Commissioner of Income Tax (Appeals) (in short, the ld. CIT(A)) dated 02/11/2021 for the Assessment Year (AY) 2017-18. The assessee has raised following grounds of appeal: 1. On the facts and circumstances of the case as well as law on the subject, the Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . CIT(A). Before the ld. CIT(A), the assessee filed detailed written submissions. The submission of assessee are recorded in para 4 of order of ld. CIT(A). The assessee in his submission submitted that the assessee was having sufficient cash in hand at the time of deposit. The assessee deposited Rs. 31,42,500/- in his bank and the assessee was having opening cash balance in hand of Rs. 29,59,546/- which was increased to Rs. 36,39,139/- as on 08/11/2016 when demonetization scheme was declared. The assessee filed complete explanation during the assessment. Besides that the assessee also filed online response on 11/02/2017 with regard to Bank of Baroda and Surat District Cooperative Bank Ltd. during demonetization period and submitted that cash deposit was out of cash in hand as on 01/04/2016. After submission of assessee, no further enquiry was raised by Income Tax Department. The Assessing Officer in the assessment order observed that there is no scarcity in withdrawing cash from bank from time to time for any specific purpose and holding the same as cash in have without utilizing the same. Further the Assessing Officer noted that repeated cash withdrawal have been made from bank ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rises (P) Ltd. (2020) 117 taxmann.com 745 (Raj). 5. The ld. CIT(A) after considering the submission of assessee noted that the Assessing Officer made addition of Rs. 31,42,340/- on account of unexplained cash credit. The assessee has used creative and imaginative accounting to justify the cash in the books of account on various points of time. The justification of cash during the period of demonetization is the motivating factor for creating entries in the books of account. The huge cash transaction makes the whole transaction as suspicious in nature. The assessee has not proved with sufficient evidence with justification before the Assessing Officer as well as before him. The entries in the books of account are to be substantiated by relevant confirmation and evidences alongwith cash flow, the books of account entries will remain merely an entry on a piece of paper. The assessee despite giving opportunity failed to discharge the onus of providing justifications in the books of account. The assessee is not doing any business activity. The assessee is a senior citizen and it is hard to believe the need of such cash. The assessee failed to justify the movements of cash in the book ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cs and after claiming deduction, the assessee has offered net income of Rs. 8,48,840/-. Besides that the assessee was having agriculture income of Rs. 1,94,370/- and other exempt income of Rs. 30,000/-. The ld. AR of the assessee further submits that he has filed cash flow statement from 01/04/2016 to 08/11/2016. The assessee was having opening cash balance of Rs. 29,59,546/- on 01.04.2016. The cash balance available as on 08/11/2016 was Rs. 36,34,139/-. The assessee made deposits of Rs. 31,42,500/- on various dates between 10/11/2016 to 03/12/2016. The ld AR for the assessee filed cash flow statement. The ld. AR further submits that the assessee is consistently showing good return of income and furnished following bifurcation of return of income for various years: Income as per Return filed A.Y. Net Income 2010-11 511277 2011-12 427388 2012-13 634220 2013-14 673340 2014-15 622070 2015-16 600560 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he demonetization period. The plea of assessee about availability of cash in hand was rejected by assessing officer by taking a view that the assessee has shown repeated cash withdrawal even though more than sufficient cash balance was allegedly available with the assessee. The assessee was not carrying out any business activities, thus availability of huge cash balance as on 01/04/2016 is not justifiable. The assessee has deposited Rs. 7.00 lacs on 12/11/2016, Rs. 8.00 las on 13/11/2016, Rs. 2.39 lacs on 13/11/2016 and Rs. 3.00 lacs in Bank of Baroda on 14/11/2016 and Rs. 3.00 lacs again in Bank of Baroda on 15/11/2016. Such pattern of cash deposit itself indicates that the same was not out of accumulated cash in hand from past few years as claimed by assessee. The plea of assessee that cash on account of withdrawal was rejected by Assessing Officer by holding that there is no justification in withdrawing cash from time to time for any specific purpose and holding the same as cash in hand without utilizing the same. Despite the fact that the assessee was having sufficient cash balance allegedly available with the assessee. The ld. CIT(A) also confirmed the action of Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... redit entry of Rs. 13,532/- and there were certain withdrawals of Rs. 10,000/- to Rs. 12,000/- on different dates. However, there was balance available in the account of Rs. 14,75,785/-. Thus, the pattern in bank account about the debit and credit also does not matches with the huge cash available with the assessee as on 01/04/2016. Thus, I do not find any justifiable reason to interfere with the additions made by Assessing Officer and confirmed by ld. CIT(A). However, I find that the Central Board of Direct Taxes (CBDT) vide its Circular No. 3 of 2017 dated 21.02.2017 have clarified that a relaxation of Rs. 2.50 lacs in a case of an ordinary deposit and Rs. 5.00 lacs in case of Senior Citizen. It was further clarified that the sources of such amount may be either of household savings or past income or the amount may have been received from any of the source mentioned in para 2 to 6 of that Circular. Thus, the assessee is given benefit of Rs. 5.00 lacs in terms of Circular of CBDT, thereby remaining amount of Rs. 31,42,500 5,00,000 = 26,42,500/- is upheld. In the result, ground No. 1 of the appeal is partly allowed. 14. So far as taxability of addition under amended provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the business, for which the books are maintained, remained to be entered therein. True, the asset found is in the form of a trading asset of the business. The same, however, by itself represents neither accrual nor receipt of income, the two incidents that attract charge of tax under the Act, and which it must to be attributable to a defined source of income, but is only an application of that income, which though is deemed as income and, further, for the year in which it is so found. That is, but for ss. 68, 69 thro 69D, the amount under reference may not stand to be assessed as income and, in any case, as the income of the relevant year. The non-detection of any income; rather, source of income, in the documents found and impounded during survey, on which much store was placed by Shri Bardia during hearing, rather, favours the Revenue s case. Even as observed by the Bench thereat, there is nothing in the material found during survey which suggests either suppression of sales or inflation of expenses by the assessee, by which two modes income of a disclosed business is generally kept out of it s accounts. Though the impugned order records a finding as to underinvoicing of sales, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r burden lies on the Revenue, upon deeming a cash credit as the assesee s income, to show that it is from a particular source. In the facts of the instant case even the books of account have not been rejected. Coming to the decisions by the Tribunal, claimed to be covering the matter, none were referred to during hearing, even as Sh. Bardia contended of the same being based on credence being allowed to circumstantial evidence/s. The question in these cases thus admittedly turned on the facts of the case. Questions of, and decisions based on findings of, fact, do not yield any statement of law, which alone is binding or has precedential value (The Mavilayi Service Cooperative Bank Ltd. vs. CIT [1961] 431 ITR 01 (SC)). Our decision, on the contrary, is based on first legal principles, clarified, explained and settled by the Hon'ble Apex Court. Why, all we have stated is that the burden of proof in the matter lies on the assessee, and cannot be a matter of presumption, so that there no difference in principle, but only as to whether the assessee s claim/s stands proved by it. The Apex Court in Anantharm Veerasinghaiah v. CIT [1980] 123 457 (SC) explained that on a claim in its res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year, i.e., one from 01/04/2016 to 14/12/2016, and another from 15/12/2016 to 31/03/2017, but, then, that is no reason to read retrospectivity where the applicable date is clear and, further, there is nothing to suggest retrospectivity. Further, extraordinary and supervening circumstance of the Demonetization Scheme, 2016, brought out by the Government of India in November, 2016, explains the urgency in bringing an amendment mid-year. Further, the tax rate being in respect of incomes which are imputed with reference to a transaction/s, it is possible to administer the same, another aspect of the matter that stands considered by us. That is, a tax rate for transactions made up to 14/12/2016, and another for those thereafter. Subsequent mention of the applicability of the amended provisions of ss. 271AAB and 271AAC with reference to the date on which the Presidential assent to the Act is received, further corroborates this view, which is based on the clear language of the Amending Act, as well as the principle that a substantive amendment is to be generally prospective. We draw support from the decision in Vatika Township Pvt. Ltd. (supra), reiterating the settled law of the rule ag ..... X X X X Extracts X X X X X X X X Extracts X X X X
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