Unexplained cash deposit during demonetisation was deleted where business source and accepted cash transactions supported the assessee's explanation.

Cash deposited during demonetisation was examined under section 69A read with section 115BBE of the Income-tax Act, 1961, where the assessee explained that the funds arose from regular retail business activity in telecommunication products. The record showed that the Revenue had accepted the assessee's other cash transactions as business income and had confined the addition only to the disputed deposit. On those facts, the explanation for the source of cash was found satisfactory, and the addition was deleted.

---

---

Issues: Whether the cash deposit of Rs. 5.01 lakhs during demonetization was rightly treated as unexplained income under section 69A read with section 115BBE of the Income-tax Act, 1961.

Analysis: The assessee explained that the cash deposit arose from regular business activity as a retailer of telecommunication products. The material on record showed that the Revenue had accepted the assessee's remaining cash transactions as business income, and the addition was confined only to the impugned amount. On these facts, the explanation regarding the source of the cash deposit was found satisfactory.

Conclusion: The addition under section 69A read with section 115BBE was deleted and the issue was decided in favour of the assessee.

---