Unexplained Cash Deposits: contemporaneous sale deeds and bank records can establish source, leading to deletion of addition.

Issue concerns unexplained cash deposits treated as income where the assessee claimed deposits were sale proceeds of ancestral agricultural land; tribunal examined bank entries, registered sale deeds, assessee statements and subsequent withdrawals/transfers to daughters who invested in land. Tribunal applied principle that contemporaneous documentary nexus and corroborative circumstances can establish source where department adduces no contrary evidence and related assessments accepted identical source. On this factual matrix the addition under the unexplained cash deposit provision was found unjustified and deleted, allowing the appeal in favour of the assessee.

---

---

Issues: (i) Whether the addition of Rs. 2,12,96,000 made as unexplained cash deposit under section 69 of the Income-tax Act, 1961, is justified where the assessee claimed the deposits were sale proceeds of ancestral agricultural land and there was nexus between sale deeds, bank deposits and subsequent withdrawals and investments by her daughters.

Analysis: The Tribunal examined the material on record including bank entries showing deposits on 28.02.2012, registered sale deeds, the assessee's statements under section 133(6), and subsequent withdrawal and transfers to daughters who invested in agricultural land. The Tribunal considered precedents of coordinate Benches where similar facts-deposit of substantial cash contemporaneous with sale deeds, absence of contrary evidence from the department, and acceptance of source in related assessments-led to deletion of additions. The factual matrix showed the assessee was elderly, had no other income source, the timing of deposits corresponded to sale transactions, and the department had accepted identical source in respect of the daughters. In these circumstances, the Tribunal found the CIT(A) was not justified in sustaining the section 69 addition of Rs. 2,12,96,000 where a direct nexus and corroborative circumstances supported the assessee's explanation.

Conclusion: The addition of Rs. 2,12,96,000 as unexplained cash deposit under section 69 of the Income-tax Act, 1961, is deleted and the appeal is allowed in favour of the assessee.

---