Mauli Mahila Nagari Sahakari Path Sanstha Limited Vs ITO (ITAT Pune)
ITAT Pune held that deposit of demonetized notes collected by from its members would not be hit by provisions of section 68 of the Income Tax Act. Further, reason for collection of demonetized notes after prescribed date of 8.11.2016 duly provided. Hence, addition unsustainable.
Facts- During the assessment proceedings, the assessee was asked to explain the sources of Rs.12,47,000/- deposited during the demonetization period. In response to which the assessee submitted the computation of total income and the amount of Rs.12,47,000/- were stated to be out of income from other sources. AO in the absence of any straight and concrete evidences, treated the amount of Rs.12,47,000/- as unexplained money and added to the total income of the assessee u/s 69A r.w.s. 115BBE of the Act.
Aggrieved, the assessee challenged the matter in appeal before the Ld. CIT(A). However, the same was dismissed. Being aggrieved, the present appeal is filed.
Conclusion- Held that the assessee has also explained as to why it has collected demonetized notes after the prescribed date of 8.11.2016. The assessee has explained that it has stopped collection after the receipt of notification dated 14.11.2016 issued by RBI, which has clearly clarified that the assessee society should not collect the demonetized notes. Accordingly, I am of the view that the deposit of demonetized notes collected by the assessee from its members would not be hit by the provisions of section 68 of the Act in the facts and circumstances of the case. Accordingly, I set aside the order passed by Ld. CIT(A) on this issue and direct the A.O. to delete this disallowance.
