Cash deposits during demonetisation were accepted as explained by withdrawals, cash balance, and agricultural income.

Cash deposits made during the demonetisation period were held to be satisfactorily explained where the assessee supported the source with bank statements showing earlier withdrawals, opening cash balance, and agricultural receipts. The Tribunal also considered the assessee's medical condition and the surrounding material as consistent with the available cash resources. On that record, the deposits had a plausible sourced explanation, so the addition as unexplained money under section 69A of the Income-tax Act, 1961 was deleted.

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Issues: Whether the cash deposits made during the demonetization period were proved to be explained from earlier cash withdrawals and agricultural income, so as to negate addition as unexplained money under section 69A of the Income-tax Act, 1961.

Analysis: The assessee produced bank statements showing earlier cash withdrawals, opening cash balance, and agricultural receipts spanning the relevant period. The Tribunal also took note of the assessee's medical condition and the material placed to show that the deposits in question were consistent with available cash resources. On the record, the deposits were found to have a plausible and supported source, and the basis for treating the entire amount as unexplained did not survive.

Conclusion: The addition under section 69A of the Income-tax Act, 1961 was not sustainable and was deleted; the assessee succeeded on merits.

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