Case Law Details
Mudhol Pattina Sahakari Sangh Niyamita Vs ACIT (ITAT Bangalore)
In a significant judgment by the Income Tax Appellate Tribunal (ITAT) Bangalore, the case of Mudhol Pattina Sahakari Sangh Niyamita vs. Assistant Commissioner of Income Tax (ACIT) brought to light the critical interpretation and application of Section 68 of the Income Tax Act, 1961. This case revolved around the addition of income from undisclosed sources and underscored the necessity for thorough examination of the source of cash deposits post-demonetization. The ruling, dated 24.07.2023, for the Assessment Year 2017-18, provides essential insights into the handling of cash deposits during the demonetization period and its tax implications.
Detailed Analysis:
The core issue in this appeal was whether the addition of ₹18,33,678 as income from undisclosed sources under Section 68 of the Income Tax Act, 1961, by the Assessing Officer (AO) and confirmed by the Commissioner of Income Tax (Appeals) [CIT(A)], was justified without a detailed examination of the source of cash deposits made during the demonetization period.
The assessee, a cooperative society registered under the Karnataka Cooperative Societies Act, 1959, had its appeal partly allowed by the CIT(A). While the CIT(A) directed the AO to allow deduction under Section 80P, the addition made regarding the cash deposits during demonetization was confirmed.
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