Tribunal allows appeal partially, deems Rs. 7,92,000 unexplained income under Section 69A.

The Tribunal partially allowed the appeal, directing relief of Rs. 8 lakhs sourced from loans, while treating the remaining Rs. 7,92,000 as unexplained income under section 69A. The appellant's explanations regarding cash deposits from friends for a failed business were considered, but the lack of concrete evidence led to income estimation by the Tribunal. The decision was pronounced on 26th July, 2023 in Chennai.

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Issues involved:
The appeal challenges the order of the Commissioner of Income Tax (Appeals) regarding the addition of unexplained money under section 69A of the Income-tax Act, 1961 for the assessment year 2012-13.

Grounds of Appeal:
1. The National Faceless Appeal Centre's order was deemed contrary to law, erroneous, and unsustainable.
2. The addition of Rs. 15,92,000 as unexplained money under section 69A was contested.
3. The explanation provided for cash deposits in the bank account was claimed to be valid and should have resulted in deletion of the addition.
4. The source of cash deposits from savings in Kuwait employment and friends for a new business was explained, justifying deletion of the addition.
5. Withdrawal of funds due to the failed business venture and return of money to friends was highlighted to challenge the sustained addition.
6. The appellant's occupation as a vegetable vendor was cited as a legitimate source of income, warranting deletion of the addition.
7. Overall, the appellant's submissions were argued to justify deletion of the addition under section 69A of the Act.

Judgment Details:
The appellant, an individual, did not file the income tax return for the relevant assessment year. Substantial cash deposits were made into a savings bank account, leading to a reassessment under section 147 of the Act. The Assessing Officer made an addition of Rs. 15,92,000 under section 69A due to unexplained cash deposits. The appellant's appeal to the CIT(A) was unsuccessful, resulting in the current appeal.

Upon review, the appellant presented additional evidence, including confirmation letters from individuals claiming to have provided loans for a business venture. The appellant explained that the cash deposits were from friends for the failed business, with subsequent withdrawals to repay loans. The appellant's inability to provide concrete evidence for the source of cash deposits was a point of contention.

After considering the arguments and evidence, the Tribunal found that while the appellant claimed loans from friends for the business, the lack of substantial proof led to an estimation of income from cash deposits. The Tribunal directed relief of Rs. 8 lakhs, considering this amount as sourced from loans, with the remaining Rs. 7,92,000 being treated as unexplained income under section 69A.

In conclusion, the appeal was partly allowed, with the Tribunal's decision pronounced on 26th July, 2023 in Chennai.

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