The Income Tax Appellate Tribunal (ITAT) of Bangalore Bench held that the payment of bonus made to employees before the due date of filing a return of income under Section 139(1) of Income Tax Act are sufficient for compliance of Section 43B of Income Tax Act, 1961.
Neralakere Marulasiddappa Dayananda, the taxpayer deposited an amount of Rs.18,44,000/- in during the demonetization period in the bank account. The assessee submitted that the sources of deposit are out of agricultural income and LIC commission, which is received through bank transfers.
Accordingly, AO after considering various submissions of the assessee made an addition of Rs.18,44,000/- as the assessee failed to furnish any satisfactory explanation with documentary evidence regarding the nature and source of cash deposits made.
Aggrieved by the order, the assessee filed an appeal before the National Faceless Appeal Centre {NFAC} who upheld the order. Thus the assessee filed a second appeal before the tribunal.
Before the bench, Vevek A.R, the counsel for the assessee submitted he is a member of the Hindu Undivided Family having agricultural lands to the extent of 12.30 acres. Thus, the cash deposited in the bank was the income earned from the agricultural proceeds only.
Priyadarshini Besaganni, Counsel for revenue contents that cash deposited during the demonetization period has to be verified in the light of the Circular issued by the Central Board of Direct Taxes (CBDT)
Therefore, the tribunal after considering the submissions of both parties concluded that as per the CBDT instruction dated 09/08/2019 and 21/02/2017 point out that not every deposit during the demonetization period would fall under the category of unaccounted cash.
Thus, two member benches of the tribunal comprising Chandra Poojari (Accountant Member) and Beena Pillai (Judicial Member) assessee are directed to establish all relevant details to substantiate its claim in line with the above applicable instructions as applicable to the present facts of the assessee.
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