2025 (2) TMI 1032 - AT - Income Tax

Addition u/s 69A - unexplained cash credit - as during demonetization period the assessee had deposited a sum in bank account - assessee could not establish source for the balance cash deposit with no source of income - HELD THAT - Assessee has filed additional evidences such as income tax returns filed by Mother of assessee and Wife of the assessee for the A.Y. 2017-2018 which are already with the Department and also an affidavits where they were admitted to have paid cash to the assessee and to establish the source of cash deposit and source of income. From the careful perusal of the above documentary evidences placed before the Tribunal we find that the assessee has deposited the cash in the Bank out of the income of family members for the purpose of marriage expenditure appears to be bonafide and reasonable. Therefore we direct the Assessing Officer to delete the addition sustained by the CIT(A) - Decided in favour of assessee.

Summary

The appeal in this case was filed by the assessee against the Order of the learned CIT(A)-National Faceless Appeal Centre, Delhi, concerning the assessment year 2017-2018. The main issue at the outset was a delay of 72 days in filing the appeal before the Tribunal. The assessee sought condonation of the delay due to ill-health, while the Revenue strongly opposed it, citing the addition made by the Assessing Officer under section 69A of the Act. The Tribunal, referring to the Supreme Court decision in Collector, Land Acquisition vs. MST Katiji, decided to condone the delay and admit the appeal for adjudication.The case involved the assessee, an individual deriving income from salary, who had deposited a sum of Rs. 16 lakhs during the demonetization period. The Assessing Officer treated this as unexplained cash credit, leading to an addition of Rs. 16 lakhs to the assessee's income. The assessee's explanation that the deposits were from family members and past savings was not fully accepted by the CIT(A), who sustained an addition of Rs. 8,95,000 out of the total Rs. 16 lakhs.On appeal before the Tribunal, the assessee contended that the addition was not justified, providing evidence of the source of deposits from family members and income tax returns. The Tribunal considered the additional evidence and found it reasonable, directing the Assessing Officer to delete the addition of Rs. 8,95,000. Consequently, the appeal of the assessee was allowed.In conclusion, the Tribunal allowed the appeal of the assessee, directing the deletion of the addition sustained by the CIT(A) towards cash deposits made in the bank account. The decision was based on the assessee's submission of additional evidence regarding the source of the deposits, which was found to be bonafide and reasonable.