ITA No.1785/KOL/2025

Parties Involved

Facts Summary

The Assessee filed a return of income declaring NIL income for Assessment Year 2017-18. The case was selected for scrutiny under CASS due to cash deposits during the demonetisation period. The Assessing Officer found that the Assessee deposited cash amounting to Rs.35,67,000/- in specified bank notes during the demonetisation period. The Assessee claimed that the source of the deposit was cash in hand. However, the Assessing Officer found that the Assessee's daily cash expenses were negligible and there was no rational reason to keep such a large amount of cash in hand. The Assessing Officer made an addition of Rs.35,67,000/- by treating the same as unexplained cash credit under section 68 of the Income Tax Act, 1961. The Assessee appealed against the order of the Commissioner of Income Tax (Appeals), which was dismissed. The Assessee then appealed to the Income Tax Appellate Tribunal.…

Legal Issues

• 1. Whether the addition made by the Assessing Officer under section 68 of the Income Tax Act, 1961 is justified?
• 2. Whether the Assessee has established the availability of cash in hand?

Judgment Outcome

Decided in favour of Assessee.

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