On-money from property sale must be taxed as capital gains consideration, not unexplained money under section 69A.

On-money received from the sale of immovable property was treated as part of the sale consideration, not as unexplained money under section 69A. Because the assessment itself accepted that the cash receipt arose from the property transaction and came from the buyer, the conditions for section 69A were not met. The amount attributable to each co-owner therefore had to be included in computation of capital gains. The same principle applied to the connected appeal on identical facts, and the addition under section 69A was held unsustainable.

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Issues: Whether on-money received on sale of immovable property could be taxed as unexplained money under section 69A, or whether it formed part of the sale consideration liable to tax under the head 'Income from Capital Gains'.

Analysis: The receipt in question was treated by the assessment order itself as on-money arising from the sale of the property and thus as having come from the buyer. Once the source of the cash receipt was accepted as sale proceeds from the property transaction, the statutory conditions for section 69A were not satisfied, because that provision applies only where the assessee is found to be the owner of unrecorded money with no satisfactory explanation as to its nature and source. The receipt retained the character of part of the agreed sale consideration, and the amount attributable to each co-owner had to be included in the computation of capital gains rather than assessed as unexplained money under section 69A. The same reasoning applied to the connected appeal involving identical facts.

Conclusion: The addition under section 69A was not sustainable, and the on-money had to be included in the sale consideration for computation of capital gains. The appeals were therefore partly allowed to that extent.

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