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TMI Blog2024 (6) TMI 1020X X X X Extracts X X X X X X X X Extracts X X X X ..... introduced w.e.f. 01.04.2017. Since AO and CIT(A) failed to consider the provisions of 36(1)(viia)(d) and assessee had filed additional evidence to substantiate this claim, in the interest of substantial justice, we set- aside the addition made by AO to the Assessing Officer for denovo adjudication. Addition u/s 68 - assessee has received cash in old currency during the demonetization period - as submitted cash accepted during the demonetization period was towards the instalment of outstanding loan account of the borrower - HELD THAT:- To invoke section 68 of the Act, the AO has to prove that assessee failed to file identity of the depositors, genuineness of the transaction and creditworthiness. In this case, the assessee had submitted the names of the persons from whom cash was received during the demonetization period in the form of demonetized currency. Assessee also submitted that assessee maintains all KYC documents of all these persons. The AO had not asked the assessee to produce the said KYC Documents. Rather AO has not challenged the identity of the depositors, genuineness of the transactions and creditworthiness of the depositors. In these facts and circumstances of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 43 to 63. The relevant written submission is reproduced here as under : 4. The appellant could not produce the documents referred to in the Paper Book No.2 at Sr. No.8, which is working of Deduction U/Sec.36(l)(via) of the Act for AY 2017-18 as both the lower authorities have not considered the amendment in Section 36(1)(via)(d) of the Act while making an addition. 5. The Appellant prays that in the interest of justice the additional evidences may be admitted and the issue may be decided after considering the additional evidences. The Appellant relies on the ratio laid by the Hon'ble Supreme Court in the case of Tek Ram v. CIT (2013) 357 ITR 133 wherein it was held that where documents filed by assessee before Court had some relevance, same should be considered while deciding appeal. 2.1 The ld.AR has relied on the following decisions : 1. Hon'ble ITAT Pune Bench in ITO Vs. CD Patani Nagri Sahkari Pat Sanstha in ITA No.727/PUN/2022 for A.Y. 2017-18 dated 28.03.2023. 2. Hon'ble ITAT Pune Bench in Bhagur Urban Credit Co-operative Society Limited Vs. ITO in ITA No.561/PUN/2022 for A.Y.2017-18 dated 03.0.2023. 3. Hon'ble ITAT Chennai Bench in Purani Hospital Supplies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant was requested to give details of nature of transactions, reason for giving cash & complete details of persons/s who has given cash. It was also required by the appellant to submit allowability of provision made against standard asset as it is neither covered u/s 36(1)(viia) nor u/s 37(1) of the I.T. Act. In response, the appellant submitted that cash was accepted from the customers who were borrowers and amount was credited in the customer loan repayment account during the period 08.11.2016 to 31.12.2016. The appellant had interpreted the circular as the NBFC is financial company like bank so it accepted the cash in borrower loan account. The findings of Ld. CIT(A) findings are as under on the issue of addition u/s 68 of I.T. Act 1961: "The appellant has not demonstrated with evidence that it is authorized by the Government to receive the old currency notes during the demonetization period. Therefore, it is held that although the appellant was not legally allowed to receive the old currency notes during the demonetization period, it appears that the appellant has received such currencies even after the announcement of demonetization. As Govt, of India has declar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iety, it is proposed to amend the provision clause (viia) of sub- section (1) of section 36 so as to provide deduction from total income (computed before making any deduction under this clause and Chapter-VIA) on account of provision for bad and doubtful debts to the extent of five per cent of the total income in the case of NBFCs. This amendment will take effect from 1st April, 2017 and will, accordingly, apply in relation to the assessment year 2017-18 and subsequent assessment years. 4.3 Since AO and ld.CIT(A) failed to consider the provisions of 36(1)(viia)(d) and assessee had filed additional evidence to substantiate this claim, in the interest of substantial justice, we set- aside the addition made by AO of Rs. 6,66,151/- to the Assessing Officer for denovo adjudication. The Assessing Officer shall give opportunity to the assessee. Accordingly, Ground No.1 of the assessee is allowed for statistical purpose. Ground No.2 and 3 : 5. During the assessment proceedings, the AO observed that the assessee has received cash in old currency during the demonetization period between 08.11.2016 to 13.12.2016 of Rs. 12,34,000/-. The assessee submitted before the AO that these amounts ..... X X X X Extracts X X X X X X X X Extracts X X X X
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