Tax Tribunal Overturns Unexplained Cash Addition: Evidence Proves Income Source Legitimate, Deleting 2019-20 Assessment.

The Appellate Tribunal allowed the appeal filed by the assessee, overturning the addition of unexplained cash made by the Assessing Officer and affirmed by the Ld. Commissioner under section 69A of the Income Tax Act. The Tribunal, upon reviewing the evidence, including the balance sheet and cash book, found the source of cash adequately explained and deleted the addition from the assessee's income for A.Y. 2019-20.

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Issues involved:
The appeal against the order passed by the Ld. Commissioner of Income Tax (Appeals) under section 250 of the Income Tax Act, 1961 for the A.Y. 2019-20 regarding the addition of unexplained cash found during a search action.

Summary:

Issue 1: Declaration of Income and Addition of Unexplained Cash
The assessee declared total income and claimed deductions in the return filed, but during a search action, unexplained cash and jewellery were found. The Assessing Officer treated the cash amount as unexplained money under section 69A of the Act. The Ld. Commissioner affirmed the addition, stating lack of documentary evidence to support the claims made by the assessee regarding the cash found.

Issue 2: Challenge and Hearing
The assessee challenged the addition before the Appellate Tribunal, presenting balance sheet and cash book as evidence. The written submissions of the assessee clarified the source of the cash found, attributing it to savings, gifts, and recorded amounts in the books of account. The Tribunal considered the evidence submitted by the assessee and found no reason to affirm the addition, ultimately deleting the added amount from the assessee's income.

In conclusion, the Appellate Tribunal allowed the appeal filed by the assessee, setting aside the addition of the unexplained cash amount as made by the Assessing Officer and affirmed by the Ld. Commissioner.

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