The Income Tax Appellate Tribunal (ITAT), Delhi Bench ‘A’, adjudicated on the appeal filed by the DCIT, Circle-4(2), New Delhi against the order passed by the Commissioner of Income Tax (Appeals)-2, New Delhi. The appeal, registered as ITA No. 352/DEL/2021, pertains to the assessment year 2017-18.
Bawa Jewellers Pvt. Ltd., located at A-24, Tagore Market, Kirti Nagar, West, New Delhi, filed its return of income for the assessment year 2017-18 on 29.09.2017 declaring income of Rs.1,21,28,780/-. The case was selected for scrutiny through CASS due to large cash deposits during the demonetization period.
The appellant raised the following grounds of appeal:
The case was heard on 18.05.2023, and the order was pronounced on 09.06.2023. The Tribunal, comprising Shri Narendra Kumar Billaiya, Accountant Member, and Shri Challa Nagendra Prasad, Judicial Member, reviewed the submissions and the relevant facts of the case.
The main issue in this appeal was the addition of Rs. 9,99,51,075/- under Section 68 of the Income Tax Act by the Assessing Officer (AO) due to cash deposits made during the demonetization period. The AO concluded that the deposits were not justified despite the assessee’s explanation and supporting documents.
During the assessment proceedings, the AO observed that Bawa Jewellers Pvt. Ltd. had deposited cash of Rs. 21,69,98,000/- between 09.11.2016 and 31.12.2016. The assessee furnished month-wise cash sales, cash deposits, purchases, and other relevant documents. The AO, however, determined that the increase in cash deposits and cash sales during this period was not in line with the normal business operations and treated Rs. 9,99,51,075/- as unexplained cash credits under Section 68.
The Tribunal found that the CIT(A) had made a reasoned decision based on relevant judicial precedents, and the Revenue did not present any substantial evidence to counter the findings. The Tribunal upheld the CIT(A)’s order, deleting the addition made by the AO under Section 68, and dismissed the appeal filed by the Revenue.
The appeal filed by DCIT, Circle-4(2), New Delhi was dismissed.
Order pronounced in the open court on 09.06.2023.
Signed by:
(Narendra Kumar Billaiya) – Accountant Member
(C.N. Prasad) – Judicial Member
Date: 09.06.2023
*Kavita Arora, Sr. P.S.*
Copy forwarded to:
ASSISTANT REGISTRAR ITAT, New Delhi
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