Yogesh Malik Vs ACIT (ITAT Delhi)
The Delhi Bench of the Income Tax Appellate Tribunal partly allowed the appeal for Assessment Year 2017–18 concerning the tax treatment of cash deposits made during the demonetisation period. The assessee’s appeal arose from an order passed under section 143(3) of the Income Tax Act, which had been upheld by the Commissioner (Appeals), NFAC. The assessee did not appear at the hearing and was proceeded against ex parte. The central issue involved cash deposits of ₹1,12,56,371 that were treated as unexplained under section 68 read with section 115BBE. The Revenue argued that the assessee failed to satisfactorily explain the source of the deposits or reconcile them with business turnover. It was, however, undisputed that the assessee operated a petrol pump and that the business turnover was audited under VAT law, with supporting evidence filed during assessment and appellate proceedings.
After examining the record, the Tribunal held that it would be inappropriate to treat the entire cash deposits as unexplained merely because the explanation was not fully accepted by the lower authorities. Considering the nature of the business and the available evidence, the Tribunal restricted the addition to a lump sum of ₹2,00,000, granting substantial relief of ₹1,21,44,721. It clarified that this relief should not be treated as a precedent.
