TaxTMI 
TaxTMI 
2026 (1) TMI 879
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....ted in toto. 2. Addition of Rs. 27,00,000/- as Unexplained Money u/s. 69A of the Act 2.1. The learned CIT(A) erred in sustaining the addition made by the Assessing Officer by invoking provisions of section 69A of the Act in respect of cash deposited by the Appellant despite the fact that the cash so deposited were duly recorded in his books of accounts. The Appellant prays that the addition sustained on this count be deleted in toto. 2.2. The learned CIT (A) erred in sustaining the addition made by the Assessing Officer in respect of cash deposited by the Appellant as unexplained money u/s. 69A of the Act even though the nature and source of the same was duly explained by the Appellant as cash withdrawn from bank by the Appellant. The Appellant prays that the addition sustained on this count be deleted in toto. 2.3. The learned CIT (A) erred in sustaining the addition made by the Assessing Officer in respect of cash deposited by the Appellant as unexplained money u/s. 69A of the Act even though the nature and source of the same as explained by the Appellant as cash withdrawn from bank by the Appellant is verifiable on the face of the records. The....
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....ngs of the Ld. CIT(A)/NFAC are reproduced below:- "5.3.1 The crux of the appellant's argument is that since the cash was recorded in the audited books of account and the source of receipts (bank withdrawals) was not disputed, the addition under Section 69A is unwarranted. However, this argument overlooks the fundamental principles governing "unexplained money" under the Act, especially in the context of specific events like demonetization. Section 69A of the Income Tax Act, 1961, clearly states: "Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article and such money, bullion, jewellery or valuable article is not recorded in the books of account, if any, maintained by him for any source of income, and the assessee offers no explanation about the nature and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year." The em....
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....n that the source of this cash remained unexplained. Therefore, the addition of Rs. 27,00,000/- under Section 69A of the Act was justified and correctly made by the Assessing Officer." 5. Aggrieved, the assessee is in appeal before this Tribunal and all the grounds of appeal relate therein. 6. The Ld.AR submitted that books of account of the assessee have been audited by the Chartered Accountant (CA) u/s. 44AB of the Act, which were duly filed before the Ld.AO along with cash book maintained by the assessee. He submitted the following chart showing the details of cash deposited into bank account(s) of the assessee during demonetization period:- Details of Cash Deposited into Bank Accounts during Demonetisation Period Sr. No. Date Available Cash Balance before Cash Deposit Amount Deposit Name of the Bank Account Type Account Number 1 10/11/2016 37,12,282 2,00,000 HDFC Bank Current 5020013988032 2 11/11/2016 34,87,282 1,00,000 Dena Bank Saving 21310029033 3 12/11/2016 33,82,715 1,00,000 Dena Bank Saving 21310029033 4 16/11/2016 32,06,3....
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....O vs. Mrs. Deepali Sehgal in ITA No. 5660/DEL/2012, dated 05.09.2014, Ld.AR submitted that there is no law which stated that savings are to be kept in the bank account only and cannot be held as cash in hand. Further justification/ necessity of cash withdrawal is irrelevant and cannot be questioned. 7. Ld. Departmental Representative (DR), on the other hand, heavily relied on the orders of Ld.AO and Ld. CIT(A)/NFAC. He submitted that the decisions relied on by the Ld.AR are distinguishable and are not applicable to the facts of the present case. Ld. DR contended that Ld.AO has taken a valid stand that cash deposited is out of unaccounted money, as admittedly if there was more than enough cash balance available with the assessee prior to the dates of deposits, then what was the need for withdrawal of more cash and depositing the same during demonetization period. Referring to the cash availability statement reproduced below, submitted by the assessee during the course of hearing, he contended that the same appears to be camouflaged. Cash Availability Statement Month Opening Balance Cash Withdrawn from Bank Accounts Other Cash Inflow (like Local Transport Receipts e....
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....nd hence the impugned addition. We find that the Ld. CIT(A)/NFAC sustained the addition made by the Ld.AO for the reasons already reproduced in preceding paragraph. It is the submission of the Learned Counsel for the assessee that the provisions of section 69A cannot be invoked in the present case since cash so deposited is duly recorded in the audited books of account that has been accepted by the Ld.AO. It is his submission that the source of cash deposited being withdrawal of cash on earlier occasions ought to have been accepted as the withdrawal of cash is squarely verifiable from the assessee's bank statement(s) and there was more than sufficient cash available on the dates of deposits which is also verifiable from cash book and cash availability statement. It is also the submission of the Ld.AR that Ld.AO has not brought on record any adverse material so as to support his stand that cash deposited by the assessee is out of his unaccounted money. It is also his submission that assessee is maintaining the requisite books of account which is duly audited and accepted by the Ld.AO. 9. Perusal of the cash availability statement (reproduced above) as filed by the assessee shows ....