9911796707
TMI Blog2023 (8) TMI 1274X X X X Extracts X X X X X X X X Extracts X X X X ..... There is no doubt that the assessee has satisfied the identity of the deposits, who are members of the society and genuineness of the transactions because the amounts have been deposited in the members accounts only. If the AO had any doubts that the assessee has not satisfied the ingredients of section 68, he could have asked further details from the assessee, but the AO has not done the same, which clearly shows that the assessee has discharged its duty to satisfy the requirement of section 68. We further note that the SBNs have been deposited in the members accounts, accordingly, the assessee did not get any extra benefit as observed by the AO which was treated as income us 69A - In view of this, the provisions of section 68 is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with 25 percent surcharge which was brought by amendment on 15/12/2016 (retrospective amendment-after commencement of assessment year 2017-18) which is bad in law. 4. The appellants craves leave to add/alter any of the grounds of appeal on or before the date of final hearing. 2. The brief facts are that the assessee is a cooperative society registered under the Karnataka State Co-op. Societies Act, 1959 and is engaged in the activity of accepting deposits, providing credit facilities, making investments and lending medium term agricultural related loans to its members. The assessee has made investments in fixed deposits etc. and derives interest income therefrom. There are also associate members in this society. The assessee filed r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the AO. Aggrieved, the assessee is in appeal before the Tribunal. 5. The ld. AR submitted that during the demonetisation period, the assessee accepted cash deposits from its members for depositing in pigmy accounts, loan accounts, SBs A/c, and different accounts maintained with the assessee. The collection of money from the members was in the ordinary course of business. The assessee did not get any financial benefit as alleged by the AO because the money was deposited in the members accounts only. After submitting the details of the members no further information was sought by the AO, accordingly, the assessee discharged the very purpose of section 68. Therefore section 68 will not apply in the hands of the assessee. He further su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee has produced a list of depositors and the amount deposited by members with denominations of currency. The assessee has accepted the deposits from its members from 9.11.2016 to 14.11.2016. As per Gazette Notification of RBI Govt. of India dated 08.11.2016, the assessee was not authorized to accept cash deposits in SBNs. The AO observed that the assessee was not authorized to receive or collect money in SBNs of Rs. 1,000 and Rs. 500 which were not in legal tender w.e.f. 09.11.2016 and such transactions on or after 09.11.2016 cannot be entered in cash book. The cash deposits made by the members of the society had no value as such. The Assessing Officer issued show-cause notice by observing that the impugned amount should be treated as i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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