Unexplained income from NRI deposits fails when UAE remittance trail and bank records establish the source of funds.

An addition for unexplained income arising from deposits in an NRI bank account was held unsustainable where the assessee substantiated that the funds originated from a UAE business account and were routed through an exchange house. The record showed withdrawal of 150,000 AED from the UAE account, remittance through AL Rostamani International Exchange LLC, and corresponding credit in the Indian bank account. On that evidence, the source of the remitted cash stood established, so the deposit could not be treated as unexplained income and the addition was deleted.

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Issues: Whether the addition of Rs. 25,00,000 as unexplained income from deposits in the assessee's NRI bank account was sustainable when the assessee claimed that the amount was remitted from his UAE business account through an exchange house.

Analysis: The assessee produced the UAE business account and related remittance material showing withdrawal of 150,000 AED on 27/09/2014 and its transfer through AL Rostamani International Exchange LLC, with corresponding credit in the Indian bank account. On the record, the source of the cash remitted from UAE stood established and the addition could not be sustained as unexplained income.

Conclusion: The addition was not justified and was deleted.

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