Satish Kumar Malik vs. Income Tax Officer

Parties Involved

Facts Summary

The assessee, Satish Kumar Malik, is an individual engaged in the business of trading goods. He filed his return of income for the year 2017-18 declaring a total income of Rs. 26,19,530/-. His case was selected for complete scrutiny due to an abnormal increase in cash deposits during the demonetization period. The Assessing Officer (AO) found that the assessee had deposited Rs. 44,44,750/- in cash during this period, the source of which was not explained. Consequently, the AO made an addition of this amount as unexplained credits under section 68 of the Income Tax Act, 1961, and invoked section 115BBE to charge tax at a higher rate. The assessee appealed this order before the Learned Commissioner of Income Tax (Appeals), who partly allowed the appeal, directing a reduction in the addition. Aggrieved by this order, the assessee further appealed to the Tribunal.…

Legal Issues

• 1. Whether the AO erred in making an addition of ₹44,44,750 under section 68 read with section 115BBE by treating the cash deposited during demonetization as unexplained cash credit.
• 2. Whether the AO and the Ld CIT(A) erred in characterizing the cash deposit as cash sales without properly appreciating the evidence provided by the assessee.
• 3. Whether the Ld CIT(A) erred in upholding the addition under section 68 read with section 115BBE, resulting in unjust double taxation.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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