Unexplained money addition under section 69A fails where bank credits and cash deposits are supported by evidence and explanations.

Bank credits and cash deposits could not be treated as unexplained money under section 69A where the assessee explained them as insurance premium collections, inter-bank transfers, partnership-related transactions, and personal dealings with relatives and friends. The first appellate authority accepted those explanations on the material on record, and the Tribunal noted that the Assessing Officer brought no contrary evidence to displace them. As the receipts were duly explained and nothing remained unaccounted, the addition was held unsustainable and the deletion was upheld in favour of the assessee.

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Issues: Whether the addition made as unexplained money under section 69A of the Income-tax Act, 1961 on account of bank credits and cash deposits was justified.

Analysis: The credits were examined in the assessment and appellate proceedings. The assessee furnished explanations that the receipts represented insurance premium collections, inter-bank transfers, transactions with firms in which he was a partner, and personal transactions with relatives and friends. The first appellate authority found the explanations to be supported by material on record and recorded that the transactions stood duly explained. The Tribunal noted that the Assessing Officer had not displaced those explanations with contrary material and that no amount remained unaccounted so as to attract section 69A.

Conclusion: The addition under section 69A was not sustainable and the deletion was upheld in favour of the assessee.

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