Case Number: ITA 840/DEL/2021
Appellant: Perminder Kaur Matharoo, New Delhi
Respondent: ITO WARD – 44(7), New Delhi
Assessment Year: 2017-18
Result: 2017-18
Case Filed on: 2021-07-09
Order Type: Final Tribunal Order
Date of Order: 2022-11-15
Pronounced on: 2022-11-15
This appeal was filed by Smt. Perminder Kaur Matharoo for the Assessment Year 2017-18 against the order dated 26.05.2021 framed by the National Faceless Appeal Centre (NFAC). The main issue pertained to the addition of cash deposits during the demonetization period.
The appellant raised a grievance regarding the addition of Rs. 7,65,000/- sustained by the NFAC against a total addition of Rs. 11,90,179/-. The case was selected for scrutiny to verify the cash deposits made during the demonetization period, and the appellant was asked to furnish an explanation.
The case was heard by the Delhi ‘H’ Bench of the Income Tax Appellate Tribunal (ITAT), with Shri N.K. Billaiya, Accountant Member, and Shri Kul Bharat, Judicial Member, presiding over the matter. The hearing was held on 09.11.2022, and the order was pronounced on 15.11.2022.
The appellant submitted that the cash deposits were made from the opening cash in hand and cash withdrawals during the financial year prior to demonetization. The Assessing Officer accepted the opening cash in hand of Rs. 8,34,821/- but questioned the source of the remaining cash deposits.
The Assessing Officer completed the assessment by accepting the opening cash in hand and made an addition of Rs. 11,90,179/- under section 69A read with section 115BBE of the Income Tax Act. The appellant then appealed to the CIT(A), providing a detailed cash flow statement and statement of affairs to explain the cash deposits.
The CIT(A) gave a different interpretation, stating that the opening cash balance of Rs. 8,34,821/- was not declared in the return of income filed online. The CIT(A) estimated the availability of cash after deducting monthly expenses and concluded that an addition of Rs. 7,65,000/- was justified.
The Tribunal carefully reviewed the orders of the authorities below and the documentary evidence provided by the appellant. The Tribunal noted that the cash book clearly showed the opening balance and the cash flow statement explained the cash deposits. The Tribunal found no defects in the cash books, cash flow statement, and statement of affairs provided by the appellant.
The Tribunal ruled that the source of the cash deposits in the bank account could not be disregarded by the authorities since the cash flow statement was not controverted by the Assessing Officer or the CIT(A). The Tribunal referred to the decision of the Hon’ble High Court of Delhi in the case of Omni Info (ITA No. 364/2016) to support its view.
The Tribunal directed the Assessing Officer to delete the addition of Rs. 7,65,000/- and allowed the appeal of the assessee.
The order pronounced in the open court on 15th November, 2022, was as follows:
Order pronounced in the open court on 15th November, 2022
Sd/- Sd/-
(KUL BHARAT) (N.K. BILLAIYA)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Date: 15th November, 2022
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(A)
5. DR
Asst. Registrar, ITAT, New Delhi
Perminder Kaur Matharoo vs ITO: Demonetization Cash Deposit Case – Final Tribunal Order
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