The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has quashed the addition made against a practicing doctor for cash deposit during the demonetisation period.
During the course of assessment proceeding, it was observed that the assessee Ashok Wasan, had deposited cash during the year under consideration, the reason for the selection of case through CASS. On further examination of the facts, a sharp increase in sales/receipts on account of professional service was noted in this case for the year under consideration.
Cash deposited and shown as professional receipt was allowed to the tune of regular trend of quantum of business activities carried out by assessee which approximately the increase of 16 percentage points over the various assessment years and the amount of cash deposited in excess to the same was disallowed.
The Increase of sales in the case of assessee , professional receipts was disallowed and added back to the income of assessee under Section 69A of the Income Tax Act , 1961 for Assessee being the owner of unexplained money.
K. Sampath, appeared on behalf of the assessee and Kanv Bali appeared on behalf of the revenue.
The two-member Bench of Saktijit Dey, (Judicial Member) B. R. R. Kumar, (Accountant Member) held the impugned order as invalid and allowed the appeal filed by the assessee holding that no abnormal cash deposit was found and the assessment order was based on estimation and strange logic.
“There has been only one cash deposit of Rs. 165,000/- on account of old currency notes (SBN) in a savings bank account. The assessee is a practicing doctor, ENT specialist, deriving income from medical practice. The assessee has also deposited cash in his Saving Bank account (non-SBN) which has been duly accepted by the AO during the same period,” the Bench further observed.
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