Bibekananda Pradhan Vs DCIT (ITAT Cuttack)
In the case of Bibekananda Pradhan Vs DCIT, the appellant appealed against the order of the CIT(A), which upheld an addition of ₹16,80,000 under Section 69 of the Income Tax Act for cash deposited during the demonetization period. The appellant, represented by Advocate P.R. Mohanty, argued that the cash deposits were legitimate as they resulted from sales of Indian Made Foreign Liquor (IMFL) made under exceptional circumstances—specifically, customers paid in specified bank notes (SBN) after purchasing liquor, which could not be returned once opened. The Assessing Officer (AO) acknowledged the appellant’s cash sales but deemed ₹16,80,000 as unexplained, despite having accepted other cash deposits amounting to ₹6,30,000. The Senior DR supported the AO’s stance, asserting that the appellant should not have accepted SBN as a trader. However, the ITAT found merit in the appellant’s argument, stating that the acceptance of SBN was a reasonable response to extraordinary circumstances to avoid loss of business. Ultimately, the ITAT decided to delete the addition of ₹16,80,000, allowing the appeal based on the justifiable acceptance of cash during the demonetization period.
FULL TEXT OF THE ORDER OF ITAT CUTTACK
This is an appeal filed by the assessee against the order of the ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi, dated 12.03.2024, passed in DIN & Order No.ITBA/NFAC/S/250/2023- 24/1062424984(1) for the assessment year 2017-2018, on the following grounds of appeal :-
1. For that order dated 12.03.2024 as passed under Section 250 of the I.T. Act, 1961 by the Commissioner of Income Tax (Appeals) Income Tax Department hereinafter referred to as the learned CIT(Appeals) dismissing the appeal is not just and legal on the facts and in the circumstances of the case.
2. For that the learned CIT(Appeals) without properly appreciating the submissions of the appellant from its proper perspective should not have confirmed the addition of 18,16,000/- u/s.69 of the I.T. Act, 1961 on the facts and in the circumstances of the case.
3. For that the learned Assessing Officer having admitted that the appellant was having only cash sales and the appellant was used to deposit the cash in the bank account the learned AO is not justified to make addition of Rs. 18,16,000/- u/s.69 of the I.T. Act, 1961 on the facts and in the circumstances of the case.
2. The assessee is represented by Shri P.R.Mohanty, Advocate and department is represented by Shri S.C.Mohanty, Sr. DR.
