Reena Vs ITO (ITAT Chandigarh)
Income-tax Appellate Tribunal (ITAT), Chandigarh, delivered an order in the case of Reena Vs ITO for the Assessment Year 2017-18, allowing the assessee’s appeal and deleting a cash deposit addition of 21.09 Lacs. The appeal arose from a best judgment assessment made by the Assessing Officer (AO) under Section 144 of the Income-tax Act, 1961. The AO had treated the cash deposits and interest income as unexplained income after the assessee failed to respond to initial inquiries.
In the first appeal, before the Commissioner of Income Tax (Appeals) [CIT(A)], the assessee contended that the cash originated from the sale of property and business receipts from her small-time snack vending business. However, the CIT(A) confirmed the AO’s assessment, stating that the assessee had not provided “acceptable evidences” to substantiate her claim.
The matter proceeded to the ITAT, where the assessee’s legal representative presented detailed evidence, including a cash flow statement and cash books for the relevant financial years. The documentation showed a total cash inflow of Rs. 34.31 Lacs from multiple sources, including Rs. 14.25 Lacs and Rs. 7.43 Lacs from property sales, a Rs. 3.00 Lacs re-deposit of a cash withdrawal, and Rs. 9.63 Lacs from business receipts. The representative also provided a computation of income that included a Long-Term Capital Loss from the property sales.
