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TMI Blog2025 (1) TMI 1118X X X X Extracts X X X X X X X X Extracts X X X X ..... t cash deposits in her bank account. As availability of cash with the assessee as on the date of cash deposits which would have sourced the cash deposits of Rs. 11 lacs (supra) in her bank account with Allahabad Bank, Raipur is restricted to the extent of Rs. 3,50,000/-. Hence, sustain the addition partly. X X X X Extracts X X X X X X X X Extracts X X X X ..... 32/- was kept by her in cash out of earlier years, while for a sum of Rs. 3,27,968/- was sourced out of her subject year income. However, the aforesaid explanation of the assessee did not find favour with the A.O. The A.O was of the view that no person would keep such substantial amount of cash at home with all risk of life and safety when there were ample banking facilities available round the clock. As the assessee had failed to explain the "nature" and "source" of the cash deposits of Rs. 11,00,000/-, therefore, the A.O made an addition of the entire amount by treating it as the assessee's unexplained money u/s. 69A of the Act. Accordingly, the A.O vide his order passed u/s.143(3) of the Act, dated 28.11.2019, after making the aforesaid addition determined the income of the assessee at Rs. 13,14,350/-. 4. Aggrieved the assessee carried the matter in appeal before the CIT(Appeals) but without success. For the sake of clarity, the observations of the CIT(Appeals) are culled out as under: "8. I have considered the facts of the case/assessment order. The facts of the case, as perused from the order of the AO are that the assessee had filed her original return of income u/s.139(1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of the assessee, treating it as unexplained money u/s 69A of the Act to the total income of the assessee. 8.2 In this regard, it is pertinent to mention here that during the course of appellate proceedings, the appellant has not filed any written submission after issuing various notices u/s.250 of the Act as mentioned in the para 4 of this order. 8.3 In the instant case, it is observed that the appellant neither furnished a satisfactory explanation with supporting evidence in support of her claim during the course of assessment proceedings nor during the course of appellate proceedings. It clearly shows that the appellant is not in position to explain the source of the said cash deposit with supporting evidences. It is important to note here that it was the prime responsibility of the appellant to explain the nature and source of cash deposit in her bank account(s) with necessary supporting evidences. However, the appellant has completely failed to discharge her onus as per law. 8.4 Moreover, section 69A of the Act deals with Money etc. owned by the assessee and found in possession including in the bank accounts of the assessee which remained unexplained. Section 69A-Une ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation of source and its genuineness. To explain "Nature" It would require the assessee to explain what is description of investment or expenditure, period and the manner in which it was done. To explain the source it would require the assessee to explain the corpus or fund from where investment or expenditure has been met. 8.5.2 in the present case, the nature and source of such cash deposits made in the assessee's bank account(s) were not at all explained, leave alone satisfactory explanation. Further, for invoking deeming provisions under Section 69A of the act, there should be clearly identifiable asset or unexplained Money. It is amply proved beyond doubt that the assessee's deposits appearing in her bank account(s) remains unexplained, and the sum of Rs. 11,00,000/-i.e. cash deposits in the appellant's bank account(s) are identifiable unexplained assets. The limbs of Section 69A of the Act stands qualified in the case of the assessee, i.e. • the assessee was found to be owner of the Money. • its nature and source is not identifiable. 8.5.3 The Hon'ble Supreme Court in the case of Chuharmal Vs CIT (1988) 172 ITR 250 while affirming ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vings. His explanation was accepted in respect of Rs. 15,000, because 15 notes could be traced to a bank, but was rejected in respect of the balance. The Patna High Court pointed out that if an assessee received an amount in the year of account, it was for him to show that the amount so received did not bear the character of income, and the taxpayer in the case had failed to prove this fact in respect of the remaining notes. The Hon'ble Supreme Court has held that The cases involving the encashment of high denomination notes are quite numerous. In some of them the explanation tendered by the tax-payer has been accepted and in some it has been rejected Where the assessee was unable to prove that in his normal business or otherwise, he was possessed of so much cash, it was hold that the assessee started under a cloud and must dispel that cloud to the reasonable satisfaction of the assessing authorities, and that if he did not then, the Department was free to reject his explanation and to hold that the amount represented income from some undisclosed source." The Hon'ble Supreme Court further held in the case of Smt. Srilekha Banerjee and others (cited supra) that 't ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 lakhs to returned income of assessee - Assessee preferred an appeal against same During pendency of appeal, revenue issued a reassessment notice on ground that assessee had failed to satisfactorily explain source of fund for cash-deposit of Rs. 12.50 lakhs made by assessee in 'PN' bank - It was noted that cash-deposit of Rs. 12.50 lakhs was not adjudicated upon during original scrutiny proceedings - In income-tax return, assessee had only mentioned detail of cash deposited in 'C' bank account and had not mentioned cash deposits in any other bank accounts Whether, on facts, impugned reopening notice issued against assessee was justified-Held, yes [Paras 13, 15, 16 and 19] [In favour of revenue] 8.6.1 Reliance is also placed on the decision of the Hon'ble ITAT, Chennai Bench in the case of Raju Ravichandran vs. Income-tax Officer [2024] 159 taxmann.com 1518 (Chennai Trib.) dated 16.06.2023, wherein the Hon'ble Tribunal has upheld the similar addition made by the AO and decided the appeal in favour of the revenue. The head note of the decision is reproduced as under.- "Section 69A, read with section 115BBE, of the Income tax Act, 1961 Unexplained moneys ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eruddin Ali Khan v. ITO 42 taxmann.com 69 wherein it is held as under. "14. We have heard the submissions of both the parties and perused the material on record as well as the orders passed by the revenue authorities. Undisputedly as revealed from the bank account, the assessee has made cash deposit of Rs. 6,50,000/- on 8-9-2004. It is the contention of the assessee that the aforesaid deposits were out of the cash available with him from withdrawals made by him earlier from the SBI from February, 2002 to September, 2003. However, such explanation of the assessee is against human probability and totally unbelievable. When the assessee is having a bank account, it is beyond human probability and totally incomprehensible that the assessee would keep quite a substantial amount of Rs. 6,50,000/- in cash with him for a period of over one year without depositing into the bank account. The assessee has also not shown any valid reason as to why he kept so much cash with him for over a period of one year when he was holding a bank account. In the absence of any cogent reason backed by sufficient evidence, the explanation of the assessee is only a make-believe story and hence cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act and added back to the appellant's total income by the AO while passing the order u/s 143(3) of the Act. 9.1 It is also observed from records that the appellant had not filed any detail/explanation with supporting evidences to explain the nature and source of the said cash credit entries in her bank accounts during the course of appellate proceedings. Therefore, it can be concluded that the appellant has completely failed to discharge her onus and addition made by the AO is found to be justified. It is also relevant to note that in absence of any response/explanation in respect of cash credit entries in the bank accounts, the AO was justified in making the addition as unexplained money u/s 69A of the Act. 9.2 In view of the above factual matrix of the case, the addition made by the AO on account of cash credit entries in the appellant's bank account is upheld and hence confirmed. Thus, all grounds of appeal are dismissed. 10. In the result, the appeal is dismissed." 5. The assessee being aggrieved with the order of the CIT(Appeals) has carried the matter in appeal before the Tribunal. 6. I have heard the Ld. Authorized Representatives of both the parties, peru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dering the aforesaid fact, the additional grounds of appeal raised by the assessee are dismissed in terms of the aforesaid observations. 11. I shall now deal with the explanation of the assessee as regards the "source" of the cash deposit of Rs. 11 lacs (supra) made in her bank account during the demonetization period. As observed by me hereinabove, it is the claim of the assessee that the cash deposit in question was sourced from, viz. (i) income from the vocation of running hobby classes; (ii) accumulated cash savings of the past years; and (iii) bank withdrawals that were available with her. The assessee had failed to come forth with an irrefutable explanation as regards the source of the cash deposits of Rs. 11 lacs (supra) made in her bank account during the year under consideration. In the backdrop of the aforesaid unsubstantiated explanation of the assessee which I am afraid cannot be summarily accepted, I am left with no other alternative but to draw support from the CBDT Instruction No.3/2017, dated 21.02.2017 for estimating the amount of cash in hand that would have been available with her to source the subject cash deposits in her bank account. For the sake of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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