Appeal dismissed as assessee's explanation for undisclosed income in house construction deemed reasonable.

The appeal was filed by the Revenue against the order of the CIT(A) deleting the addition of undisclosed income for unaccounted investment in house construction. The Tribunal found the assessee's explanation reasonable, as the sources of investment were clarified. The CIT(A) decision to delete the addition was upheld, and the Revenue's appeal was dismissed.

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Issues involved:
Appeal against deletion of addition of undisclosed income for unaccounted investment in house construction.

Analysis:
The appeal was filed by the Revenue against the order of the CIT(A) deleting the addition of undisclosed income for unaccounted investment in house construction. During a search, the father of the assessee declared an undisclosed investment in house construction. The assessee explained that the sale proceeds from purchases were used for construction, supported by a fund flow statement. The AO rejected the explanation and added the amount as undisclosed income. The CIT(A) overturned this decision, citing precedents where post-search account books were accepted if verifiable. The Tribunal found the assessee's explanation reasonable, as the sources of investment were clarified. The AO failed to provide evidence contradicting the assessee's claims. Therefore, the CIT(A) decision to delete the addition was upheld, and the Revenue's appeal was dismissed.

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