Manjulaben Madhubhai Hapani Vs ITO (ITAT Surat)
ITAT Surat held that provisions of section 115BBE of the Income Tax Act are enacted on 15.12.2016 hence taxing addition at higher rate u/s. 115BBE for prior period is not sustainable. Accordingly, AO directed to tax addition at normal rate of tax.
Facts- The case of the assessee was selected for complete scrutiny under CASS. Notably, The assessee had deposited cash of Rs.11,43,500/- during 09.11.2016 to 30.12.2016 in her bank accounts. She submitted that the same was from cash-on-hand and business receipts in cash. A show cause noticed was issued to the assessee on 10.12.2019, calling for the reply and explanation.
AO noticed that assessee had shown net agricultural income of Rs.6,92,062/- for AY.2017-18 and Rs.7,17,797/- for AY.2016-17. However, net agricultural income of Rs.1,32,825/-, Rs. Nil and Rs.50,000/- were declared in the returns of income filed for AYs.2013-14 to 2015-16. There was big difference in agricultural income shown in the returns of income filed after demonetization period and filed for earlier years. Thus, AO allowed agricultural income of Rs.2,00,000/- each for AYs.2016-17 and 2017-18. The differential amounts of Rs.5,17,797/- and Rs.4,92,062/- were treated as unexplained cash credits u/s 68 of the Act and were taxed @ 60% u/s 115BBE of the Act. AO assessed the total income of Rs.12,48,769/- against the returned income of Rs.2,38,910/-. Penalty proceedings also initiated by AO u/s 274 r.w.s. 271AAC of the Act.
