Tax Officials Cannot Double Tax Legitimate Cash Deposits From Sales During Demonetization Under Section 69A and 115BBE

ITAT upheld CIT(A)'s deletion of additions made under s.69A r.w.s. 115BBE regarding unexplained cash deposits during demonetization. The assessee successfully demonstrated that cash deposits originated from legitimate sales recorded in books of accounts and already subjected to taxation. The tribunal noted that only 17.50% of pre-demonetization stock was sold on 08.11.2016, rejecting AO's allegations of abnormal sales as unsupported by evidence. ITAT emphasized that additions cannot be sustained merely on suspicion or conjecture, particularly when cash from sales was properly recorded in books. Double taxation being impermissible, s.69A provisions were deemed inapplicable as the source of deposits was adequately explained and documented. .....

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