Naranbhai Samatbhai Bharwad Vs ITO (ITAT Ahmedabad)
ITAT Ahmedabad held that tax rate u/s. 115BBE of the Income Tax Act increased from 30% to 60% and the same is applicable only with effect from 1st April 2017 and not prior to the same. Hence, appeal allowed to that extent.
Facts- The assessee filed return of income on 10.11.2017 declaring total income of Rs.2,09,270/-. The case has been taken up for complete scrutiny by the revenue authorities and addition of Rs.68,50,000/- has been made on account of cash deposits in bank account. CIT(A) affirmed the order of AO. Being aggrieved, the present appeal is filed.
Conclusion- Held that keeping in view the entire contents and facts specific to the instant case, we deem it appropriate to determine that the assessee could have had cash in hand of Rs.30 lakhs and the remaining can be treated as undisclosed income.
Hon’ble High Court of Madras in the case S.MI.L.E Microfinance Limited Vs. The Assistant Commissioner of Income Tax has held that the under section 115BBE the rate of tax imposed is increased from 30% to 60% and the same is applicable with effect from 01.04.2017 onwards as per the amendment. Therefore, the same is applicable to any transaction from 01.04.2017 onwards and nor prior to any transactions prior to 01.04.2017. Since in the present case all alleged transactions are for the period from 08.11.2016 to 30.12.2016, hence the erstwhile rate of tax 30% only is applicable. But the contention of the revenue is that the amendment was with effect from 01.04.2017 and hence the same is applicable for the financial year 2016-2017 and the assessment year 2017-2018.
