NALLASAMY JAYAPRAKASH,ERODE vs. DCIT, CIRCLE-1, ERODE

आदेश / O R D E R

PER MANU KUMAR GIRI, JM:

The captioned appeal filed by the Assessee is directed against the order of the Ld. Commissioner of Income Tax (Appeals), NFAC, Delhi, [CIT(A)] dated 19.01.2026 for Assessment Year (AY) 2017- 18. 2. Brief facts of the case are that the assessee, an employee of Tata Consultancy Services, filed the return of income for AY 2017-18 declaring a total income of Rs.21,77,010/-. During the

ITA No. 983/Chny/2026 (AY 2017-18) Nallasamy Jayaprakash Vs DCIT C-1 :: 2 :: demonetization period, cash of Rs.30,05,500/- was deposited into his HDFC Bank account. The case was selected for limited scrutiny to examine the source of the cash deposits. The assessee explained that the deposits were sourced from (i) housing loan disbursal from HDFC Bank of Rs.20,00,000/-, (ii) gift of Rs.5,00,000/- received from his mother out of agricultural income and savings, and (iii) past salary savings of Rs.5,05,500/-. The Assessing Officer (AO) treated the deposits as unexplained and made an addition. The Assessing Officer was not satisfied with the explanation regarding the source of the cash deposits during the demonetization period. Holding that the assessee had failed to satisfactorily establish the source of the cash deposited, the Assessing Officer treated the amount of Rs.30,05,500/- as unexplained under the Act and brought the same to tax. 3. On appeal, assessment order was confirmed by the CIT(A). The CIT(A) upheld the addition of Rs.30,05,500/- observing that though the assessee claimed that Rs.14,00,000/- withdrawn on 26.10.2015 from the HDFC loan was parked with relatives and later redeposited, no details of such relatives were furnished. The claim of past savings of Rs. 5,05,500/- was unsupported by documentary evidence. The claim of gift of Rs. 5,00,000/- from the assessee's mother was not supported by evidence regarding agricultural produce or sale bills to substantiate her agricultural income. Consequently, the CIT(A) held that the source of the cash deposits remained unexplained and confirmed the addition by a brief order. Now assessee is in appeal before the Tribunal. 4. The ld. Authorised Representative (AR) for the assessee submitted that the CIT(A) passed a cryptic order without properly appreciating the evidence and explanations furnished. It is

ITA No. 983/Chny/2026 (AY 2017-18) Nallasamy Jayaprakash Vs DCIT C-1 :: 3 :: contended that the availability of Rs.20,00,000/- out of the HDFC housing loan disbursed in October 2015 was never disputed. The assessee had produced the loan sanction letter and bank statement evidencing withdrawals, including a withdrawal of Rs.14,00,000/- on 26.10.2015. The CIT(A) rejected the explanation merely because details of the relatives with whom the cash was kept were not furnished, though the assessee had only stated that the cash was kept in safe custody with his sister during his employment-related transfers. An affidavit explaining the circumstances under which the withdrawn cash remained available for redeposit is also filed before the Tribunal. He also contended that the authorities failed to consider that there was no material to show that the withdrawn cash had been utilized elsewhere. In respect to the gift of Rs.5,00,000/-, it is submitted that the assessee has furnished confirmation from his mother along with evidence regarding her agricultural land holdings. He pleaded that the ld.CIT(A) wrongly insisted upon production of agricultural sale bills, thereby requiring proof of the source of the source, which was not legally required in proceedings u/s. 69A for AY 2017-18. It is further submitted that the assessee had substantial salary income in earlier years and the claim of past savings of Rs.5,05,500/- was reasonable and supported by the income disclosed in earlier returns. It is therefore prayed that the addition be deleted. 5. The ld. Departmental Representative (DR) supported the orders of the lower authorities and submitted that the assessee had failed to satisfactorily establish the source of the cash deposits with cogent documentary evidence. It was contended that the CIT(A) has rightly confirmed the addition in the absence of acceptable evidence

ITA No. 983/Chny/2026 (AY 2017-18) Nallasamy Jayaprakash Vs DCIT C-1 :: 4 :: regarding the loan withdrawals, the alleged gift and the claim of past savings. 6. We have considered the rival submissions and perused the material available on record. The CIT(A), while confirming the addition, has rejected the assessee's explanation primarily on the ground that the assessee had not furnished details of the relatives with whom the cash withdrawn from the loan account was allegedly kept, had not produced evidence for past savings and had not furnished agricultural sale bills in support of the gift received from his mother. 7. Before us, the ld.AR for the assessee has placed reliance upon additional explanations and supporting documents including an affidavit explaining the circumstances relating to the HDFC loan withdrawals and safe custody of the cash, confirmation regarding the gift from his mother together with documents relating to her agricultural land holdings, and details of his past income to substantiate the claim of past savings. We find that these explanations and documents require proper examination and appreciation by the first appellate authority. The impugned appellate order is brief and does not contain any detailed discussion on the evidentiary value of the documents or the legal contentions raised by the assessee. Since the additional evidence/explanations now relied upon go to the root of the matter, the interest of justice would be served by restoring the issue to the file of the Commissioner (Appeals) for fresh adjudication. Accordingly, we set aside the impugned order of the CIT(A) and restore the matter to his file with a direction to consider all the evidence and documents produced by the assessee, examine the explanations in accordance with law, afford adequate opportunity of hearing to both parties,

ITA No. 983/Chny/2026 (AY 2017-18) Nallasamy Jayaprakash Vs DCIT C-1 :: 5 :: and pass a reasoned and speaking order after considering all the contentions raised by the assessee as well as the submissions of the Revenue. The assessee shall extend full cooperation and furnish all supporting documents that may be called for during the remand proceedings. 8. Accordingly, the grounds raised by the assessee are allowed for statistical purposes. Order pronounced in the open court on the 03rd day of August, 2026 in Chennai.

Sd/- Sd/- (इंतूरी रामा राव) (मनु कुमार िग�र) (INTURI RAMA RAO) (MANU KUMAR GIRI) लेखा सद*य/ACCOUNTANT MEMBER �या�यक सद*य/JUDICIAL MEMBER

चे�नई/Chennai, +दनांक/Dated: 03rd August, 2026. SNDP, Sr. PS

आदेश क! ��त,ल-प अ.े-षत/Copy to: 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकरआयु�/CIT, Chennai / Madurai / Salem / Coimbatore. 4. िवभागीय�ितिनिध/DR 5. गाड�फाईल/GF SANDE Digitally signed by SANDEEP EP KUMAR Date: 2026.08.05 KUMAR 16:40:45 +05'30'