ITAT rejects Income Tax Department’s Algorithm-Based Tax Addition in Cash Deposit Made During Demonetization Period

The ITAT (Income Tax Tribunal) rejected the Income Tax Department's algorithm-based tax addition related to cash deposits made during the demonetization period. The tribunal likely found the automated addition, without proper human assessment and consideration of the assessee's explanations, to be arbitrary and unsustainable. This underscores the need for tax authorities to conduct reasoned assessments rather than relying solely on automated data analysis.