Ankit Mittal Vs ITO (ITAT Chandigarh)
The appeal before the Income Tax Appellate Tribunal, Chandigarh Bench, concerned the assessment year 2017–18 and challenged the order dated 22.08.2025 passed by the Commissioner of Income Tax (Appeals). Although multiple grounds were raised, the core issue was the confirmation of an addition of ₹10 lakh and the application of the higher tax rate under section 115BBE of the Income Tax Act.
The assessee, an employee of Tata Consultancy Services Ltd., derived income from salary and bank interest and had filed a return declaring total income of ₹3,54,360. During scrutiny assessment proceedings initiated through notice under section 143(2), the Assessing Officer noted cash deposits of ₹15 lakh made during the demonetisation period.
The assessee explained that ₹5 lakh was deposited out of a cash withdrawal made on 12.10.2016, while the remaining ₹10 lakh was redeposited from earlier withdrawals. To substantiate the availability of cash, the assessee pointed out that he had sold a residential house at Jagadhri on 30.06.2015 for ₹52,88,000. The sale proceeds were deposited into his bank account, from which ₹20 lakh was withdrawn in cash. This amount was redeposited in parts, with the balance deposited during the demonetisation period.
The Assessing Officer and the Commissioner (Appeals) rejected this explanation on the ground that it was not humanly probable for an individual to retain such a large amount of cash for a prolonged period. While credit was given for part of the withdrawals, the balance ₹10 lakh was treated as unexplained and taxed under section 115BBE.
