Case Law Details
Neeru Jain Vs ITO (ITAT Delhi)
CBDT vide Instruction No.03/2017 dated 21st February 2017 has stated that no verification of cash deposits up to Rs.2.50 lakh would be made as the source of such amount could be either house hold savings/ savings from past income. He submitted that assessee’s husband works in an Multi National Company (MNC) and is a regular tax payer. He also relied on the decision of Agra Bench of Tribunal in the case of Smt. Uma Agrawal vs. ITO (in ITA No.35/AGR/2021 dated 18.06.2021). He pointed to the relevant order placed in the paper book. He therefore submitted that in view of the aforesaid decision and CBDT Circular, no addition is warranted in the present case.
ITAT have heard the rival submissions and perused the materials available on record. The issue in the present ground is with respect to cash deposits made during the demonetization period. It is an undisputed fact that assessee had deposited Rs.2.50 lakh in cash in her bank account during the demonetization period and the entire amount was treated as unexplained by the AO. When the matter was carried before the CIT(A), CIT(A) grant relief to Rs.50,000/- and upheld the addition to the extent of Rs.2,00,000/-. Before me, assessee has submitted that the deposits to be out of accumulated savings and out of the cash gifts received by her on the occasion of birthdays and anniversaries. It is also a fact that assessee’s husband is an income tax payer working for an MNC.
Considering the aforesaid facts and in view of the CBDT Circular (supra) and relying on the decision of Co-ordinate Bench of Agra Tribunal in the case of Uma Agrawal (supra), I am of the view that the explanation of the assessee about the source of cash deposits cannot be brushed aside without there being any evidence to the contrary. I therefore direct the deletion of the addition of Rs.2 lakh upheld by CIT(A).
FULL TEXT OF THE ITAT DELHI ORDER
This appeal filed by the assessee is directed against the order dated 18.03.2021 of the Commissioner of Income Tax (Appeals)-National Faceless Appeal Centre (NFAC) relating to Assessment Year 2017-18.
2. The relevant facts as culled from the material on records are as under :
3. Assessee is an individual who filed her return of income for A.Y. 2017-18 on 28.07.2017 declaring total income of Rs1,14,230/-. The case was selected for scrutiny for the reason that there was cash deposit during demonetization period. AO noticed that assessee had made cash deposits of Rs. 2,50,000/-during the demonetization period. Assessee was asked to give the details of source of cash deposits to which she inter alia submitted that the savings were out of accumulated savings in the form of pin money and minor cash gifts received by her from her parents and in-laws on the occasion of birthdays, anniversaries etc. The submission of the assessee was not found acceptable to AO. AO considered the cash deposits of Rs.2,50,000/- to be unexplained u/s 69A of the Act. Aggrieved by order of AO, assessee carried the matter before the CIT(A) who vide order dated 18.03.2021 in Appeal No.CIT(A), Delhi-21/10974/2019-20 granted partial relief to the assessee to the extent of Rs.50,000/- and upheld the addition of Rs.2,00,000/-. Aggrieved by the order of CIT(A), assessee is now in appeal and has raised the following grounds:
“1. That on the facts and in the circumstances of the case and in law, the Ld CIT(A)/ NFAC erred in confirming the addition to the extent of Rs.2,00,000/- made by the Ld. Assessing Officer under section 69A of the Act as unexplained money.
2. That the Ld. CIT(A)/NFAC erred in facts and in law in not appreciating the fact that the money belongs to the savings of the appellant as homemaker which she saved over a period of eight years from various households expenses and minor cash gift received from friends and families.
2.1 That the Ld CIT(A)/NFAC erred in facts and in law by holding that savings of a mere Rs.2,50,000/- over a period of eight years is unreasonable and extra-ordinary for a woman no belonging to very high income group families of business background.
2.2 That the Ld CIT(A)/NFAC accepted the contention of the appellant regarding savings made by her as a housewife but erred in facts and law in restricting the relief to Rs.50,000/-
3. That the Ld. CIT(A)/NFAC erred in facts and in law by ignoring specific announcements made by the Central Board of Direct Taxes that there would be no queries in respect of deposits made to the tune of Rs.2,50,000/- during the demonetization period.
3.1 That the Ld CIT(A)/NFAC erred in facts and in law in not appreciating that such announcements are made to protect small taxpayers from the burden of maintaining books of accounts and providing detailed explanations.
4. That the CIT(A)/NFAC has erred in confirming the action of Assessing Officer to not allowing the appellant benefit of maximum amount not chargeable to tax while computing the tax payable.”
4. Before me, Learned AR submitted that though the assessee has raised various grounds but the solitary issue is with respect to the addition of Rs. 2,50,000/- on account of cash deposits made by the assessee in her bank account during the demonetization period.
5. Learned AR reiterated the submissions made before the lower authorities and further submitted that the source of cash deposits was out of the accumulated savings made the assessee over the past period out of the savings from household expenses, the gifts received by her on the occasion of the birthdays and anniversaries etc. He further submitted that CBDT vide Instruction No.03/2017 dated 21st February 2017 has stated that no verification of cash deposits up to Rs.2.50 lakh would be made as the source of such amount could be either house hold savings/ savings from past income. He submitted that assessee’s husband works in an Multi National Company (MNC) and is a regular tax payer. He also relied on the decision of Agra Bench of Tribunal in the case of Smt. Uma Agrawal vs. ITO (in ITA No.35/AGR/2021 dated 18.06.2021). He pointed to the relevant order placed in the paper book. He therefore submitted that in view of the aforesaid decision and CBDT Circular, no addition is warranted in the present case.
6. Learned DR on the other hand supported the order of lower authorities.
7. I have heard the rival submissions and perused the materials available on record. The issue in the present ground is with respect to cash deposits made during the demonetization period. It is an undisputed fact that assessee had deposited Rs.2.50 lakh in cash in her bank account during the demonetization period and the entire amount was treated as unexplained by the AO. When the matter was carried before the CIT(A), CIT(A) grant relief to Rs.50,000/- and upheld the addition to the extent of Rs.2,00,000/-. Before me, assessee has submitted that the deposits to be out of accumulated savings and out of the cash gifts received by her on the occasion of birthdays and anniversaries. It is also a fact that assessee’s husband is an income tax payer working for an MNC.
8. Considering the aforesaid facts and in view of the CBDT Circular (supra) and relying on the decision of Co-ordinate Bench of Agra Tribunal in the case of Uma Agrawal (supra), I am of the view that the explanation of the assessee about the source of cash deposits cannot be brushed aside without there being any evidence to the contrary. I therefore direct the deletion of the addition of Rs.2 lakh upheld by CIT(A). Thus the ground of the assessee is allowed.
9. In the result, appeal of the assessee is allowed.
Order pronounced in the open court on 14.10.2021
