DCIT Vs Jeewan Hospital and Nursing Home Pvt. Ltd. (ITAT Delhi)
SEO Title: ITAT Delhi Restricts Demonetisation Cash Deposit Addition to Rs. 5 Lakh
Summary: The Delhi Bench of the Income Tax Appellate Tribunal considered the Revenue’s appeal against the order of the CIT(A)/NFAC dated 13.01.2026, arising from an assessment order under section 143(3) of the Income-tax Act, 1961 dated 22.12.2019 for AY 2017-18. The assessee had filed its original return on 30.10.2017 declaring income of Rs.1,25,63,340/- under normal provisions and Rs.1,33,61,734/- under section 115JB. The Assessing Officer treated cash deposits of Rs.1,80,00,000/- during the demonetization period as unexplained deposits and made an addition under section 68.
The Revenue challenged the deletion of the addition by the CIT(A), contending, among other things, that cash expenses had fallen despite an increase in cash receipts, that the assessee had not produced documentary evidence connecting increased patient inflow with the higher cash receipts, and that the unusually high cash balance before demonetization remained unexplained. It also relied on the proposition that an addition under section 68 can be made even where books are maintained, and invoked the “test of human probabilities” from Sumati Dayal v. CIT (214 ITR 801).
The assessee, on the other hand, supported the CIT(A)’s order and submitted that the addition had been made without rejecting the books of account and without independent evidence, on the basis of conjectures and surmises.
