Mistaken bank credit reversed same day cannot be treated as unexplained money; addition deleted and delay condoned.

Delay in filing the first appeal was condoned on grounds of substantial justice, lack of deliberate delay, and excusable difficulties including bank acknowledgement and COVID-19 related constraints; appeal thus admitted. A bank's erroneous credit that was reversed the same day and is supported by contemporaneous bank confirmation is not treated as unexplained money for the purposes relied upon by the revenue; the addition based on that entry was deleted. The residual sum was directed to be assessed and taxed as the assessee's normal income rather than under special unexplained-income provisions.

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Issues: (i) Whether the delay in filing the first appeal should be condoned. (ii) Whether the bank's wrongly credited and immediately reversed entry of Rs. 15,00,000/- can be treated as unexplained money liable to addition under Section 69A read with Section 115BBE of the Income-tax Act, 1961.

Issue (i): Whether the delay in filing the first appeal is liable to be condoned.

Analysis: The assessee furnished an application explaining the reasons for delay, including acknowledgement by the bank of a mistaken credit, complaints to authorities, difficulties and exclusion of limitation period during COVID-19, and technical issues in filing the appeal. The Tribunal applied the principle of substantial justice and considered whether the delay was intentional or deliberate.

Conclusion: In favour of assessee. The delay in filing the first appeal is condoned.

Issue (ii): Whether the wrongly credited and immediately reversed bank entry of Rs. 15,00,000/- constitutes unexplained money and is liable to addition under Section 69A read with Section 115BBE of the Income-tax Act, 1961.

Analysis: The record contains bank confirmation and contemporaneous evidence showing that the Rs. 15,00,000/- was a mistaken credit by the bank on 10.11.2016 and was reversed on the same day. The Tribunal examined whether such a factual scenario satisfies the elements of unexplained money under the statutory provisions relied upon by the assessing officer.

Conclusion: In favour of assessee. The addition of Rs. 15,00,000/- is deleted. The remaining amount of Rs. 1,95,447/- is to be assessed as the assessee's regular income and taxed as normal income (not under Section 115BBE).

Final Conclusion: The appeal is partly allowed: delay condoned; addition of Rs. 15,00,000/- deleted and balance amount directed to be assessed as normal income.

Ratio Decidendi: A bank's erroneous credit entry that is immediately reversed and supported by contemporaneous bank confirmation cannot be treated as unexplained money for the purposes of Section 69A of the Income-tax Act, 1961 and therefore is not liable to addition under Section 69A read with Section 115BBE of the Income-tax Act, 1961.

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