Shivam Silkfab Pvt. Ltd. Vs Additional/Joint/Deputy Assistant/CIT/ITO (ITAT Varanasi)
The Income Tax Appellate Tribunal (ITAT), Circuit Bench, Varanasi, considered the assessee’s appeal against the order of the Commissioner of Income Tax (Appeals) dated 24.12.2024 for Assessment Year 2014-15. The appeal arose from reassessment proceedings in which an addition of Rs. 17,15,56,550 under Section 68 of the Income-tax Act, 1961 had been sustained by the CIT(A).
The assessee had originally filed its return of income on 28.11.2014 declaring total income of Rs. 15,41,020, which was accepted in scrutiny assessment under Section 143(3) on 13.12.2016. Subsequently, based on information received through the Income Tax Department’s Insight Portal regarding cash deposits of Rs. 17,15,56,550 in the assessee’s bank account, reassessment proceedings were initiated by issuing notice under Section 148. The reassessment was completed under Section 147 read with Section 144B, wherein the Assessing Officer added the entire amount of cash deposits under Section 68 as unexplained cash credits and determined the total income at Rs. 17,30,97,570.
According to the assessment order, the Assessing Officer considered the cash deposits suspicious because they represented substantial cash transactions in the bank account of a private limited company. Although the assessee submitted replies to the show cause notice and participated in a video conference hearing through its authorised representative, the Assessing Officer held that the assessee had failed to conclusively establish the source of the cash deposits and accordingly treated the entire amount as unexplained cash credits under Section 68.
