Akhil Parkash (HUF) Vs ITO (ITAT Delhi)
The Income Tax Appellate Tribunal (ITAT), Delhi, partly allowed the appeal of the assessee by deleting the addition of ₹23,46,000 made under Section 69A of the Income Tax Act in respect of cash deposits made during the demonetization period.
The assessee, a Hindu Undivided Family (HUF), owned medical equipment that had been leased to its Karta, Dr. Akhil Prakash, a neuro surgeon. The assessee received instrument charges in cash every year for the use of the equipment. To substantiate this claim, the assessee produced copies of income tax returns, computation of income, capital accounts, and balance sheets for Assessment Years 2015-16 to 2017-18. It was submitted that these records reflected receipt of instrument charges and an accumulated cash-in-hand balance of ₹22,74,240 as on 31 March 2016. The assessee also relied on the Profit and Loss Accounts of Dr. Akhil Prakash, which showed corresponding instrument charges claimed as expenditure. It was contended that the cash deposited in November 2016 during demonetization represented accumulated cash-in-hand and that the instrument charges had already been offered to tax in the respective years.
The Revenue argued that the explanation regarding accumulation of instrument charges was an afterthought and supported the findings of the Assessing Officer and the Commissioner of Income Tax (Appeals).
