This case involves a dispute over the addition of INR 1,94,26,453 by the tax authorities under Section 68 of the Income-tax Act, 1961, which deals with unexplained cash credits. The appeal was filed by Ganga Deep Medicare Services Private Limited against the order of the National Faceless Appeal Centre (NFAC), which confirmed the addition made by the Assessing Officer.
The appellant, a healthcare provider operating a small hospital in Allahabad, was scrutinized for the substantial cash deposits made during the demonetization period in 2016. Despite providing detailed explanations and documentary evidence regarding their cash handling practices and patient transactions, the additions were initially upheld by the lower tax authorities.
During the tribunal hearing, the facts and figures related to the hospital’s operations were extensively examined. The tribunal acknowledged the absence of any discrepancies in the appellant’s books of accounts and recognized the legitimacy of the cash deposits made from hospital operations. The tribunal criticized the Assessing Officer’s approach, noting that assumptions made about inflated cash receipts lacked a basis in the actual handling of currency notes that were demonetized.
The tribunal’s decision to overturn the addition marked a significant relief for Ganga Deep Medicare Services, emphasizing the need for a more nuanced understanding of business operations during unusual economic events like demonetization. The case highlights the importance of maintaining detailed and accurate financial records, which helped the appellant successfully challenge the tax authority’s assumptions.
The tribunal, in its final order, allowed the appeal and directed the deletion of the impugned addition, providing a clear vindication for Ganga Deep Medicare Services. The case serves as a precedent for similar disputes involving cash transactions during the demonetization period.
Manage the increasing number of hearings effortlessly by leveraging the legal AI revolution We are India's Leading revolutionary AI-powered legal platform where you can get enough insights into top cases and judgements.
Research Platform