TaxTMI 
TaxTMI 
2026 (4) TMI 554
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed its return of income for the AY 2017-18 on 27.10.2017 declaring total income of Rs. 68,67,070/- under normal provisions and Rs. 65,77,460/- declared under deemed total income under section 115JB of the Act. Further, the case of the assessee has been selected for scrutiny under CASS with reasons "Abnormal increase in cash deposits during demonetization period as compared to pre-demonetization period". Thereafter, the assessment proceedings has been completed u/s. 143(3) of the Act on 13.12.2019 by determining assessed income of Rs. 1,77,64,070/- after making the addition of Rs. 1,08,97,000/- u/s. 68 of the Act. Against the above, assessee preferred the appeal before the Ld. CIT(A), who vide his order dated 12.2.2025 allowed the appeal of the assessee. Aggrieved, Revenue is in appeal before. 3. Ld. DR relied upon the order of the Assessing Officer and stated that Ld. CIT(A) erred in deleting the addition made by the AO of Rs. 1,08,97,000/- u/s. 68 on account of cash deposited during demonetization period without appreciating the findings of the AO as assessee failed to file any reasonable explanation in support of its claim during assessment proceedings. 4. On the other hand....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the core issues involved is of addition made u/s. 68 on account of unexplained cash credits in nature of cash deposit in the bank account, it is imperative to look upon the ratios laid down by the various Hon'ble Courts in respect of unexplained cash credits in the bank account of the assessee. 7.3 The fundamental question involved is that whether or not the AO was justified in making the additions of Rs. 1,08,97,000/- u/s 68 in the hands of the assessee, and the most critical thing to be examined in this regard is explanation of the assessee with respect to these cash deposits. There is no, and there cannot be any, dispute on the fundamental legal position that the onus is on the assessee to prove 'bonafides' or 'genuineness' of the money credited in his bank account. This approach finds support from the scheme of Section 68, which provides that where any cash credit is found in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, such sum may be charged to income tax as the in....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... if it is alleged that these tickets were obtained through fraudulent means, it is upon the alleger to prove that it is so, ignores the reality. The transaction about purchase of winning ticket takes place in secret and direct evidence about such purchase would be rarely available....n our opinion, the majority opinion after considering surrounding circumstances and applying the test of human probabilities has rightly concluded that the appellant's claim about the amount being her winning from races is not genuine. It cannot be said that the explanation offered by the appellant in respect of the said amounts has been rejected unreasonably'". 7.9 An addition under Section 68 can be made where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee either offers no explanation about the nature and source as regards the same, or the explanation offered by him in the opinion of the assessing officer is not found to be satisfactory. That before adverting further, the relevant extract of the aforesaid statutory provision, viz. Section 68, which reads as under: - "Cash credits. 68. Where any sum is found c....
X X X X Extracts X X X X
X X X X Extracts X X X X
....2,26,29,650/- (iii) Total cash deposit in bank from 9.11.2015 to 31.12.2015 1,17,62,030/- Period Amount (In Rs. ) FY 2016-17 (i) Total cash deposit in bank F.Y. 2016-17 3,51,66,476/- (ii) Total cash deposit in bank from 1.4.2016 to 8.11.2016 2,39,16,760/- (iii) Total cash deposit in bank from 9.11.2016 to 31.12.2016 1,09,97,000/- It is found that during pre-domonetization period assessee has deposited the cash of Rs. 2,39,16,776/- and whereas the cash deposited during the demonetization period was Rs. 1,08,97,000/-. ..... Thus, the total cash deposits in the bank account of the appellant for the period 1st April to 8n November and from 9th November to 31st December in the FY 2015-16 and 2016-17 were almost comparable. In fact, the total cash deposits of Rs. 1,08,97,000/- made in the bank account during the period of demonetization were even less than the total cash deposits of Rs. 1,17,62,030/- made during the same period in FY 2015-16. The main line of argument taken by the AO is that the cash deposit made by the appellant during the demonetization period does not commen....