Unexplained cash deposit during demonetisation accepted as family savings, leading to deletion of the addition.

Unexplained cash deposit during demonetisation was examined in light of the assessee's explanation that the money represented family savings accumulated over time. The small amount of the deposit and the discontinuance of Rs. 500 and Rs. 1,000 currency notes were treated as relevant circumstances supporting that explanation. On that basis, the source of the deposit was accepted and the addition was deleted.

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Issues: Whether the addition of Rs. 3,99,000 on account of unexplained cash deposit during demonetisation was sustainable.

Analysis: The cash deposit was of a small amount and was considered capable of representing family savings kept over time. The discontinuance of currency notes of Rs. 500 and Rs. 1,000 during demonetisation was taken as a relevant circumstance supporting the assessee's explanation. In these circumstances, the explanation for the source of the deposit was held to deserve acceptance.

Conclusion: The addition of Rs. 3,99,000 was deleted and the assessee succeeded on the issue.

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