Tribunal Deletes Additions: Cash Deposits Deemed Plausible Based on Tax Filings and CBDT Guidelines.

The ITAT allowed the appeal, deleting the additions made by the AO. The Tribunal found the explanation regarding the Rs. 60,000 cash deposit in Punjab National Bank plausible, as the assessee's wife was a regular tax filer. For the Rs. 2,23,000 deposited during demonetization in Canara Bank, the Tribunal applied a CBDT Instruction, noting the deposits were within the permissible threshold, thus warranting deletion of the addition. The Tribunal's decision was grounded in a comprehensive analysis of facts, legal provisions, and CBDT guidelines.

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Issues:
1. Addition of cash deposited in Punjab National Bank account.
2. Addition of cash deposited in Canara Bank account during demonetization period.

Analysis:
1. The first issue pertains to the addition of Rs. 60,000 representing cash deposited in an account held with Punjab National Bank. The Assessing Officer added this amount under Section 69A of the Income-Tax Act, 1961, as he rejected the assessee's explanation regarding receiving the cash from his wife. The Tribunal noted that the assessee's wife is an Income-Tax assessee who regularly files her returns. Considering this, the Tribunal found the explanation plausible and deleted the addition of Rs. 60,000.

2. The second issue involves the addition of cash deposited during the demonetization period in the Canara Bank account. The Assessing Officer added Rs. 2,23,000 to the assessee's income under Section 69A of the Act, as he was not fully convinced by the explanation provided by the assessee. The Tribunal referred to a CBDT Instruction stating that no verification is required if total cash deposits during demonetization do not exceed Rs. 2.50 lakhs for individuals with no business income. As the assessee fell within this threshold limit and the CBDT instruction was beneficial, the Tribunal deleted the addition of Rs. 2,23,000.

In conclusion, the Tribunal allowed the appeal, deleting the additions made by the Assessing Officer in both instances. The Tribunal's decision was based on a thorough analysis of the facts, legal provisions, and relevant instructions issued by the CBDT.

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