Section 69A unexplained money claim fails where bank deposits are reconciled as consignment sale proceeds and books remain accepted.

Bank credits exceeding turnover disclosed in the profit and loss account were not, by themselves, sufficient to invoke section 69A where the assessee produced books of account, audited statements, bank records, invoices, lorry receipts, commission statements, and a reconciliation showing that substantial deposits represented consignment sale proceeds handled as a del-credere commission agent. Because the books were not rejected under section 145(3) and no contrary material disproved the business model or reconciliation, the differential amount could not be treated as unexplained money. On that basis, the addition under section 69A was held unsustainable and directed to be deleted.

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Issues: Whether the differential amount between the bank credits and the turnover disclosed in the profit and loss account could be treated as unexplained money under section 69A of the Income-tax Act, 1961.

Analysis: The assessee produced books of account, audited financial statements, bank statements, invoices, lorry receipts, commission statements and a reconciliation explaining that a substantial part of the bank deposits represented sale proceeds of consignment transactions handled as a del-credere commission agent for principal suppliers. The books were not rejected under section 145(3) of the Income-tax Act, 1961, and no contrary material was brought to disprove the business model or the reconciliation. Mere comparison of gross bank credits with turnover disclosed in the profit and loss account was held insufficient to conclude that the differential amount constituted unexplained money.

Conclusion: The addition under section 69A of the Income-tax Act, 1961 was unsustainable and was directed to be deleted, resulting in relief to the assessee.

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