Cash deposit additions sustained where the assessee's explanation was inherently improbable and unsupported by human probability.

Cash deposits were sustained where the assessee's explanation that they represented old land sale proceeds kept for years and later moved in cash from Meghalaya to Delhi was found inherently improbable on the facts. The Tribunal held that the addition could not be deleted merely because the Assessing Officer invoked section 68 instead of section 69, since the surrounding circumstances and human probability did not support the explanation for the deposits. The first appellate order was affirmed and the assessee's challenge failed.

---

---

Issues: Whether the addition made on account of cash deposits could be sustained under section 68 of the Income-tax Act, 1961, and whether the assessee's explanation regarding the source and movement of cash was acceptable on the facts.

Analysis: The assessee's explanation was that the cash represented sale proceeds of land in Meghalaya retained for years and later transferred in cash. The Tribunal found the factual matrix inherently improbable, including the claimed retention of a large amount for an unusually long period and the unexplained transport of cash from Meghalaya to Delhi in small deposits below Rs. 50,000. It further held that the addition could not be deleted merely because the Assessing Officer invoked section 68 instead of section 69, since the surrounding facts did not justify relief.

Conclusion: The addition was upheld and the assessee's challenge failed.

Final Conclusion: The order of the first appellate authority was affirmed and the assessee's appeal was dismissed.

Ratio Decidendi: An addition will not be disturbed on a mere technical misdescription of the statutory provision where the surrounding circumstances render the explanation for cash deposits inherently unbelievable and unsupported by human probability.

---