The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench, has remanded the matter concerning the addition of cash deposits amounting to Rs 3.33 crore during the demonetization period back to the Assessing Officer (AO) for fresh examination.
This case pertains to Bhavin Amrutlal Shah. The Tribunal directed the taxpayer to deposit Rs 10,000 into the Prime Minister’s National Relief Fund within 60 days of receiving the order, as he had failed to present his case correctly before the lower authorities.
For Assessment Year 2017–18, the assessee declared a total income of ₹4.90 lakh. However, during assessment proceedings, the Assessing Officer (AO) uncovered cash deposits amounting to ₹3.33 crore across three bank accounts during the demonetization period.
Due to non-compliance with multiple Section 142(1) notices and lack of documentary proof, the AO treated the full deposit as unexplained money under Section 69A, taxing it at the higher rates prescribed under Section 115BBE.
Before the Tribunal, the taxpayer questioned the ownership of two bank accounts and claimed that the cash deposited into his State Bank of India (SBI) account was derived from cash sales.
The Tribunal said that such claims need accurate verification of bank account ownership, Know Your Customer (KYC) records, books of account, sales registers and other supporting documents.
The Tribunal said that “the issue requires proper verification of the relevant bank accounts, KYC records, books of account, Sales Register and other supporting evidences. Since the assessee did not effectively substantiate these claims before the lower authorities, in the interest of justice, we deem it appropriate to restore the issue to the file of the Assessing Officer for fresh adjudication.”
Accordingly, the ITAT quashed the Commissioner of Income Tax (Appeals) [CIT(A)] ‘s order and restored the case to the AO for fresh adjudication, subject to payment of the stipulated cost.
The AO was directed to examine the ownership of the bank accounts, after giving the taxpayer a reasonable opportunity to present their case, and to verify the nature and source of the deposits in accordance with law. The appeal was permitted for statistical purposes.
| Case Title | Bhavin Amratlal Shah vs. Income Tax Officer |
| Case No. | I.T.A. No.1202/Ahd/2026 |
| Appellant by | Shri Biren Shah, AR |
| Respondent by | Shri Manish Kasodekar |
| Ahmedabad ITAT | Read Order |
