TaxTMI 
TaxTMI 
2025 (2) TMI 1610
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.... The assessee filed return of income for the Assessment Year 2017-18 admitting total income of Rs. 4,00,000/-. The case was selected for scrutiny to verify the abnormal increase in cash deposits during demonetization period. Assessment was completed u/s 143(3) of the Income Tax Act, 1961 ('Act' in short) by making addition of Rs. 56,49,500/- u/s 69A on account of cash deposits in bank account and Rs. 54,774/- as interest income. The ld. CIT(A) partly allowed the appeal of the assessee. The relevant portion of the order of ld. CIT(A) are as under: ""3. Ground Nos. 1 to 3 are raised against the addition of Rs. 56,49,500 as unexplained cash under section 69A of the Act. The assessee had made cash deposits of Rs. 11,49,500/-....
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....ld notes. Further the date of deposit made in bank and the sale of Agricultural land forms a huge gape of time and the explanation given by the assessee he was holding cash all through the time is not acceptable. Further, the assessee has not established the genuineness of holding such huge cash balance in hand with satisfactory explanation. The copy of his son Shri. Dhanasekarn's HDFC bank account bearing No NRE- NR02321060001913 was verified. Cash was withdrawn from his son's bank account from 23.10.2008 to 06.01.2016. The date of deposit made in bank and the NRE drawings forms a huge gape of time and the explanation given by the assessee he was holding cash all through the time is not acceptable. Hence, the period of holding this....
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....le Value 1 Agricultural land at Kangayam 3601/2016, dt 18.08.2016 Rs. 9,48,000 2 Agricultural land at Kangayam 3602/2016, dt 18.08.2016 Rs. 4,09,000 Total Rs. 13,57,000 It is clear that the assessee had sold the above agricultural lands for a total consideration of Rs. 13,57,000 and out of which, the appellant has deposited Rs. 11,49,500 in SBI and Rs. 50,000 in LVB account. Above land sales occurred only two months prior to demonetization and there is no reason to doubt that the sale proceeds were deposited in bank account. So the explanation regarding land sales is acceptable. The appellant also claimed that out of total cash deposits Rs. 65,000 is from his savings or cash in h....
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.... Total 73,79,200 4.2 Appellate authorities have held that the assessee can show earlier cash receipts or withdrawals from own bank account as source of subsequent cash deposits unless the revenue is able to show that the cash so available is used for some other purposes. In this case the appellant has shown cash withdrawals from his son's bank accounts. There should be a reasonable limit for number of years one can hold the earlier withdrawals as cash in hand. From the above chart it is clear that no withdrawals were made during the year under consideration. Most of the withdrawals were made from 2008 to 2014, i.e 2 to 8 years before demonetisation. The explanation given by appellant is illogical. It is strange that his son ....
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....an afterthought. Hence this explanation is not acceptable and addition of Rs. 45,00,000 is hereby confirmed. As a result grounds 1, 2 and 3 are partly allowed. 5. Ground no 4 is against the addition of Rs. 54,774/- as SB account interest. The assessing officer held that on going through the bank statements (LVB & SBI) it was ascertained that the assessee had received SB interest of Rs. 78,608/- during the FY-2016-17 and on going through the income computation statement filed by the assessee, it was noticed that the assessee had offered SB interest of Rs. 23,834/- only. Hence the balance amount of Rs. 54774/- was added to the returned income of the assessee and brought into tax in the hands of the assessee for the assessment year 20....
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....observe that the withdrawals from the NRE Account are genuine and not sham. We also note that assessee also sold agricultural land for a total consideration of Rs. 13,57,000/- which has been accepted by the Id.CIT(A) as genuine. We find that there are withdrawals of Rs. 73,79,200/- from 23.10.2008 to 06.01.2016 which are not disputed by the revenue. We also note that cash withdrawn by the assessee from his son's account from 23.10.2008 to 06.01.2016 is on continuous intervals although there is gap of 8 years. However, so long the withdrawals are genuine, the gap is immaterial in the light of the case law citation referred [2018] 92 taxmann.com 108 (Delhi) titled Jaya Aggarwal Vs ITO by the assessee counsel. However, we observe that ther....