Suraiya Begum Vs ITO (ITAT Lucknow)
CBDT Instruction mandated that in all demonetisation cash deposit cases, notices to non-filers had to be issued by 31.12.2017- Late Notice Makes Assessment Void Ab Initio – ITAT Lucknow
ITAT Lucknow quashed the assessment framed u/s 144 r.w.s. 69A on the ground that the statutory notice u/s 142(1) was issued beyond the prescribed deadline as per CBDT instructions.
Assessee had deposited Rs. 10,00,000/- in specified bank notes during the demonetisation period & Rs. 3,08,517/- during the year in her Bank of Baroda account. AO, on failure of compliance, completed best judgment assessment u/s 144 & treated Rs. 13,08,517/- as unexplained money u/s 69A, taxed u/s 115BBE, & also initiated penalty u/s 271F. The NFAC upheld the additions rejecting Assessee’s explanation that deposits were out of sale proceeds of rural agricultural land sold on 19.05.2016 for Rs. 34 lakh.
Before the Tribunal, Assessee raised a legal plea that the notice u/s 142(1) was issued on 09.03.2018, contrary to CBDT’s Instruction No. F.225/363/2017-ITA.II dated 15.11.2017, which mandated that in all demonetisation cash deposit cases, notices to non-filers had to be issued by 31.12.2017. Since the notice was issued beyond this statutory time frame, the entire assessment stood vitiated.
