Cash deposits during demonetization disputed as unexplained income versus attribution to father's poultry business; partial tax assessment imposed.

Whether cash deposits during the demonetization period are taxable as unexplained income or belong to a disclosed family poultry business was decided by the tribunal. The tribunal accepted documentary evidence and bank confirmations showing the current account belonged to the father's poultry business and treated most deposits as attributable to and disclosed by that business. Recognising potential nonbusiness cash inflows, the tribunal estimated 25% of the deposited sum as not business-related and assessed that portion as the assessee's taxable income, resulting in an assessed taxable amount of Rs. 2,90,500.

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Issues: Whether cash deposits of Rs. 11,62,000 made in specified bank notes during the demonetization period are assessable as unexplained income of the assessee under Section 69A read with Section 115BBE of the Income-tax Act, 1961, or are attributable to and disclosed as receipts of the assessee's father's poultry business.

Analysis: The deposited amounts were made into Current Account No.2394201050747 which was operated for KSM Poultry farm, a business of the assessee's father, and the father's income tax returns for relevant years disclosed the account. The assessee produced confirmations and documentary material showing the account and loan transactions in the father's name and stated that he operated the account due to his father's age. The revenue did not controvert the confirmations but maintained that not all deposits could be shown to relate exclusively to the poultry business and relied on the provisions for treating unexplained cash deposits as income. Given the disclosures in the father's returns and the confirmations, but acknowledging possible non-business deposits, a portion of the impugned deposits was estimated as not attributable to the poultry business.

Conclusion: The appeal is partly allowed by treating 25% of the impugned cash deposits of Rs. 11,62,000 as not out of the poultry business, resulting in an estimated taxable income of Rs. 2,90,500 assessed to the assessee; the remainder of the deposits are accepted as attributable to and disclosed in the father's poultry business.

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