Section 69A cannot apply to recorded banked loan transactions where unaccounted ownership is not established.

Section 69A could not be invoked for unsecured loan transactions routed through banking channels and recorded in the assessee's books, because the statutory condition of ownership of unrecorded money was not satisfied. Even on the Revenue's case of an accommodation structure, the source traced to funds advanced by the assessee, so the amount was not "money" found outside the books. The addition was therefore deleted.

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Issues: Whether section 69A of the Income-tax Act, 1961 applied to the impugned loan transactions and justified the addition of Rs.1,12,50,000/-.

Analysis: The amount in question represented unsecured loan transactions routed through banking channels and recorded in the assessee's books of account. Section 69A applies only where the assessee is found to be the owner of money, bullion, jewellery or other valuable article not recorded in the books. Even on the Revenue's case that the seized material suggested an accommodation structure, the source of the cash was the very funds advanced by the assessee and the statutory precondition of ownership of unrecorded money was not satisfied. The addition could not therefore be sustained under section 69A.

Conclusion: The addition under section 69A was deleted and this issue was decided in favour of the assessee.

Ratio Decidendi: Section 69A cannot be invoked where the impugned amount is represented by recorded banking transactions and the assessee is not found to be the owner of unrecorded money.

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