Sangameshwar Med Store Vs ITO (ITAT, Bangalore Bench)
Medical Store’s Demonetisation Deposit Deserves a Hearing, Not a Diagnosis in Absentia: ₹13.50-Lakh Addition u/s 69A Restored to CIT(A)—Bangalore ITAT
Summary: The Bangalore ITAT set aside an ex parte appellate order confirming an addition of ₹13.50 lakh u/s 69A in respect of Specified Bank Notes deposited during the demonetisation period. Since the assessee, a medical store, was now represented by counsel & wished to substantiate that the deposits arose from business sales, the Tribunal restored the appeal to the CIT(A) for de novo adjudication on merits, while directing the assessee to attend every hearing without further default.
No Return Filed for AY 2017-18
The assessee was carrying on business as a medical store. It did not file its original return of income u/s 139 for AY 2017-18.
Information gathered through data analytics & online verification under “Operation Clean Money” revealed that the assessee had made substantial cash deposits during the demonetisation period without filing a return.
The available data showed cash deposits aggregating to ₹13,50,000 between 09.11.2016 & 30.12.2016. This was the period during which the Government had withdrawn the legal-tender status of old ₹500 & ₹1,000 currency notes, commonly described as Specified Bank Notes.
