Shantaben Manubhai Patel Vs ACIT (ITAT Surat)
The appeal before the ITAT Surat arose from an order of the Commissioner of Income Tax (Appeals) for Assessment Year 2017-18 confirming an addition under Section 69A of the Income-tax Act, 1961. The assessee, a senior citizen widow deriving income mainly from interest and agricultural activities, challenged the addition of cash deposits made during the demonetisation period and also raised an additional ground regarding the applicability of tax under Section 115BBE. The Tribunal admitted the appeal after considering the delay in filing.
The assessee had filed her return declaring total income of ₹13,57,400. Her case was selected for limited scrutiny to verify cash deposits of ₹29,98,000 made during the demonetisation period. She explained that the deposits were sourced from the opening cash-in-hand of ₹26,83,096 as on 01.04.2016 and ₹3,02,267 received from her deceased husband’s cash balance upon his death. According to the assessee, the cash balance had accumulated over earlier years primarily through withdrawals from bank accounts. To substantiate the explanation, she produced cash books for the relevant and preceding years, monthly cash summaries, bank statements showing withdrawals, and the cash book and return acknowledgement of her deceased husband.
The Assessing Officer rejected the explanation, observing that the assessee had no business activity, the cash book had been created after the event, and the claim of retaining substantial cash over a long period was improbable and contrary to normal human conduct. Accordingly, the Assessing Officer treated the cash deposits of ₹29,98,000 as unexplained money under Section 69A.
