Manish Holaram Ranglani Vs ACIT (ITAT Pune)
The appeal arises from an order of the CIT(A) NFAC, Delhi, dated 8 July 2025, in relation to the assessment completed under section 143(3) of the Income Tax Act, 1961, dated 11 December 2019. The assessee, an individual engaged in wholesale trading of food grains, pulses, and other essential commodities, filed a return of income for A.Y. 2017-18 declaring a total income of Rs. 10,30,740. The case was selected for limited scrutiny under CASS to examine cash deposits during the demonetization period of 19 November 2016 to 31 December 2016. The AO observed that the assessee had deposited Rs. 2,49,50,000 in cash during the period. While the AO accepted Rs. 76,85,746 as the opening cash balance, the remaining Rs. 1,72,64,254 was added to the income on the ground of lack of proper supporting evidence and assessed the total income at Rs. 1,82,94,990.
The assessee challenged the addition before the CIT(A) on multiple grounds: non-application of mind by the AO, correctness of the addition under section 68, incorrect observation that the deposits were in specified bank notes (SBNs), and a request to produce additional evidence. The assessee contended that the deposits were either in Rs. 100 denomination or newly issued Rs. 2,000 notes, supported by a certificate from the State Bank of India dated 17 December 2019. Despite submitting evidence, the CIT(A) upheld the AO’s addition, citing a lack of legally compliant proof regarding the nature of the currency deposited and absence of third-party validation.
