Niraj Kumar Singh Vs ITO (ITAT Delhi)
Demonetisation Cash Deposit — ITAT Grants Major Relief; Only ₹2.59 Lakh Sustained
The assessee had deposited ₹11,59,000 in cash during the demonetisation period, which the AO treated as unexplained money under Section 69A. The assessee claimed that the deposits came from earlier ATM withdrawals and an HDFC bank loan sanctioned just before demonetisation, but the explanation was not fully supported with clear evidence. The CIT(A) upheld the entire addition.
Before the ITAT, the assessee remained unrepresented. The Tribunal noted that the assessee’s explanation was only partially credible, but at the same time the Department had also disregarded certain relevant materials. Taking a balanced view in the interest of justice, the ITAT restricted the addition to ₹2,59,000, granting relief of ₹9,00,000. It also held, following the Madras High Court’s ruling in SMILE Microfinance Ltd., that Section 115BBE’s enhanced rate applies only to transactions on or after 01.04.2017.
Held: Only a part of the cash deposit remained unexplained; addition reduced to ₹2,59,000 and the appeal partly allowed.
FULL TEXT OF THE ORDER OF ITAT DELHI
This appeal by the assessee is emanating from the order of the Ld. Addl/JCIT(A)-1 Nasik dated 19.06.2025 on the solitary ground relating to sustaining the addition of Rs. 11,59,000/- made by the AO u/s. 69A of the Act by treating the cash deposit as unexplained investment.
