Case Law Details
Shail Jayesh Shah Vs ITO (ITAT Mumbai)
From the copy of the bank statement of Kotak Mahindra Bank, we find that assessee had deposited Rs.6 lakh in cash in 600 old currency notes of Rs. 1000 denomination on 01/12/2016. At a glance, it may appear that since the assessee had sufficient cash in hand amounting to Rs. 6,36,031, therefore, the aforesaid deposit of cash would have been made on 01/12/2016, out of the said balance. At the same time, we cannot be oblivious to the fact that the assessee had also incurred certain expenses in cash. From the perusal of the cash book of the assessee for the year under consideration, forming part of the paper book from pages 4–7, we find that as on 01/11/2016, the assessee had an opening balance of Rs.5,25,114. It cannot be disputed that the demonetisation was declared on 08/11/2016, and therefore the cash available with the assessee till that day can only be in old currency notes. Further, from the cash book, it is evident that after 08/11/2016, assessee withdrew total cash of Rs.1,12,000 (Rs.60,000 + Rs.2000 + Rs.2000 + Rs.24,000 + Rs.24,000) on various dates from its bank accounts maintained with Kotak Mahindra Bank, HDFC Bank, and Syndicate Bank. The assessee also has shown to have incurred an expenditure of Rs.27,453, in cash in November 2016. Thus, as on 01/12/2016, the assessee had an opening balance of Rs.6,09,661. It is pertinent to note that after 08/11/2016, the old currency notes were not legal tender and thus any cash which was withdrawn by the assessee after that date can only be in the new currency or the valid currency. Therefore, the cash withdrawn after 08/11/2016, cannot be said to have been in old currency notes which were available for deposit with the assessee on 01/12/2016. Hence, cash in hand till 08/11/2016, can only be in old currency notes which can be considered to have been deposited by the assessee on 01/12/2016. As noted above, as per the cash book, the opening balance as on 01/11/2016 was only Rs.5,25,114. Since the assessee had deposited Rs.6 lakh in cash in 600 old currency notes of Rs. 1,000, denomination on 01/12/2016, therefore, we are of the considered view that the source of deposit of only Rs.5,25,114, in old currency notes can be said to have been satisfactorily explained by the assessee. Therefore, to this extent, the AO is directed to delete the addition. As regards the balance amount of Rs.74,886, the assessee has not given any satisfactory explanation and thus, the addition is upheld to an extent of Rs.74,886. Accordingly, the sole ground raised by the assessee is partly allowed.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
The present appeal has been filed by the assessee challenging the impugned order dated 21/03/2022, passed under section 250 of the Income Tax Act, 1961 (‘the Act’) by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [‘learned CIT(A)’], for the assessment year 2017–18.
2. In this appeal, the assessee has raised the following grounds:
Please become a Premium member. If you are already a Premium member, login here to access the full content.
