What did the Tribunal hold?

The Tribunal held that the cash deposits were acceptable given the circumstances, including the father's savings, household savings, and funds from the brother for medical expenses. The addition made by the Assessing Officer was deleted.

The assessee deposited cash aggregating to Rs. 10,85,000/- in his bank account, which was treated as unaccounted income. The assessee claimed this cash represented savings of his deceased father, household savings of his wife, and funds from his brother for medical expenses.

What were the issues?

Whether the cash deposits in the assessee's bank account constituted unaccounted income, and if the explanation provided by the assessee regarding the source of funds was acceptable.

Manoj Kumar vs ITO | s.143(3) | ITAT Delhi 2026

Before: MSMADHUMITA ROY

आदेश / ORDER

The instant appeal filed by the assessee is directed against the order dated 28.01.2026 passed by the Ld. Commissioner of Income-tax (Appeals)-7, Mumbai [hereinafter referred to as the Ld. CIT(A)] under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) arising out of the Assessment Order dated 22.11.2019 passed by the ITO, Ward 23(2), Delhi Assessment Order dated 22.11.2019 passed by the ITO, Ward 23(2), Delhi Assessment Order dated 22.11.2019 passed by the ITO, Ward 23(2), Delhi

(hereinafter referred to as ‘the ld. AO’) under Section 143(3) of the Act for (hereinafter referred to as ‘the ld. AO’) under Section 143(3) of the Act for (hereinafter referred to as ‘the ld. AO’) under Section 143(3) of the Act for

Assessment Year 2017-18. 18.

The Ld. CIT(A) passed an ex parte The Ld. CIT(A) passed an ex parte order which is under challenge before order which is under challenge before

us. The assessee filed its return of income for the relevant Assessment Year on us. The assessee filed its return of income for the relevant Assessment Year on us. The assessee filed its return of income for the relevant Assessment Year on

05.08.2017 declaring income of Rs.8,67,020/ 05.08.2017 declaring income of Rs.8,67,020/-. However, the assessee was . However, the assessee was

found to have deposited cash aggregating to Rs.10,85,000/ found to have deposited cash aggregating to Rs.10,85,000/- in his bank account is bank account

which was treated as unaccounted income and added in the hands of the which was treated as unaccounted income and added in the hands of the which was treated as unaccounted income and added in the hands of the

assessee. The addition was further confirmed by the Ld. First Appellate ssee. The addition was further confirmed by the Ld. First Appellate ssee. The addition was further confirmed by the Ld. First Appellate

Authority, hence, the instant appeal before us. Authority, hence, the instant appeal before us.

Before the First Appellate Authority, the ass Before the First Appellate Authority, the assessee could not appear though essee could not appear though

notices galore were served. The facts of the case notices galore were served. The facts of the case, as submitted in the form of , as submitted in the form of

grounds of appeal before the Ld. CIT(A) and as reproduced in his order,are as grounds of appeal before the Ld. CIT(A) and as reproduced in his order, grounds of appeal before the Ld. CIT(A) and as reproduced in his order,

follows:-

“1. While assessing demand for FY 2016 While assessing demand for FY 2016-17, AO has ignored the fact 17, AO has ignored the fact that the appellant’s father Late Sh. Prem Chand Sharma was hospitalized that the appellant’s father Late Sh. Prem Chand Sharma was hospitalized that the appellant’s father Late Sh. Prem Chand Sharma was hospitalized and subsequently died during his medical treatment on 26 May 2016. and subsequently died during his medical treatment on 26 May 2016. and subsequently died during his medical treatment on 26 May 2016. 2. It is pertinent to note that we have already submi 2. It is pertinent to note that we have already submitted death certificate of tted death certificate of late Sh. Prem Chand Sharma during the assessment proceedings. The AO late Sh. Prem Chand Sharma during the assessment proceedings. The AO late Sh. Prem Chand Sharma during the assessment proceedings. The AO has rejected the submission stating that death rituals cannot last for 5-6 has rejected the submission stating that death rituals cannot last for 5 has rejected the submission stating that death rituals cannot last for 5 months in modern times. I would further like to submit that death of a months in modern times. I would further like to submit that death of a months in modern times. I would further like to submit that death of a Father is still a big set a big set-back in anyone’s life. The modern era does not back in anyone’s life. The modern era does not refrain us from being emotionally attached with our parents. Post demise of refrain us from being emotionally attached with our parents. Post demise of refrain us from being emotionally attached with our parents. Post demise of my father various legal and regulatory procedures were to be followed to my father various legal and regulatory procedures were to be followed to my father various legal and regulatory procedures were to be followed to facilitate division of assets held by my father. facilitate division of assets held by my father.

The death of my father has adversely impacted my mental and physical 3. The death of my father has adversely impacted my mental and physical 3. The death of my father has adversely impacted my mental and physical health during that period as a result of which division of assets held by Mr. health during that period as a result of which division of assets held by Mr. health during that period as a result of which division of assets held by Mr. Prem Chand Sharma was delayed. Prem Chand Sharma was delayed. 4. The cash deposited of Rs. 6,57,000/ 4. The cash deposited of Rs. 6,57,000/- during demonetization period during demonetization period pertains to total saving of my father’s life which was deposited in my ains to total saving of my father’s life which was deposited in my ains to total saving of my father’s life which was deposited in my account with consent of remaining legal heirs post death of my father. It is account with consent of remaining legal heirs post death of my father. It is account with consent of remaining legal heirs post death of my father. It is further brought to your notice that cash withdrawal of Rs. 2,00,000/- from further brought to your notice that cash withdrawal of Rs. 2,00,000/ further brought to your notice that cash withdrawal of Rs. 2,00,000/ his bank account was also made by Lat his bank account was also made by Late Sh. Prem Chand Sharma prior to e Sh. Prem Chand Sharma prior to his death in FY 2016-2017. 2017. 5. The AO has further not accepted household savings of Rs 2,17,000/- 5. The AO has further not accepted household savings of Rs 2,17,000/ 5. The AO has further not accepted household savings of Rs 2,17,000/ pertaining to my wife on ground that my wife has not given any such pertaining to my wife on ground that my wife has not given any such pertaining to my wife on ground that my wife has not given any such money succeeding/preceding to demonetization period. I wo money succeeding/preceding to demonetization period. I would like to uld like to submit that as a general practice in Indian society household savings are submit that as a general practice in Indian society household savings are submit that as a general practice in Indian society household savings are generally not disclosed to the earning member of the family for the reason generally not disclosed to the earning member of the family for the reason generally not disclosed to the earning member of the family for the reason that such savings are exclusively meant to deal with exigencies of life. The that such savings are exclusively meant to deal with exigencies of life. The that such savings are exclusively meant to deal with exigencies of life. The announcement of demonetization created an environment of fear in general monetization created an environment of fear in general monetization created an environment of fear in general public as a result of which the household savings of my wife was deposited public as a result of which the household savings of my wife was deposited public as a result of which the household savings of my wife was deposited in my bank account as a knee jerk reaction at the time of demonetization. in my bank account as a knee jerk reaction at the time of demonetization. in my bank account as a knee jerk reaction at the time of demonetization. 6. The AO has also not accepted that amount of Rs.2 6. The AO has also not accepted that amount of Rs.2,00,000/- - Lac was given by my brother Mr. Dharmender Sharma the amount was withdrawn given by my brother Mr. Dharmender Sharma the amount was withdrawn given by my brother Mr. Dharmender Sharma the amount was withdrawn from his bank account during the year before demonetization. As we are from his bank account during the year before demonetization. As we are from his bank account during the year before demonetization. As we are living in a joint family as he has paid Rs.2,00,000/ living in a joint family as he has paid Rs.2,00,000/- in respect of medical in respect of medical expenses incurred by me expenses incurred by me on my father treatments. 7. AO has not considered the facts and circumstances which is also against 7. AO has not considered the facts and circumstances which is also against 7. AO has not considered the facts and circumstances which is also against the decision of various judgements on the same issue in favour of the the decision of various judgements on the same issue in favour of the the decision of various judgements on the same issue in favour of the assessee such as Hon’ble Bench of Agra ITAT in the case of ITO V/s assessee such as Hon’ble Bench of Agra ITAT in the case of ITO V/s assessee such as Hon’ble Bench of Agra ITAT in the case of ITO V/s Rajeev Kumar Gupta Honble Bench A of Delhi ITAT in the case of ITO Honble Bench A of Delhi ITAT in the case of ITO V/s Bir Bahadur Singh Sijwali [IT Appeal No. 3814 (Delhi) of 2011] Delhi V/s Bir Bahadur Singh Sijwali [IT Appeal No. 3814 (Delhi) of 2011] Delhi V/s Bir Bahadur Singh Sijwali [IT Appeal No. 3814 (Delhi) of 2011] Delhi ITAT in the case of ITO Ward 1(1) Ghaziabad V/s Ashok Kumar ITAT in the case of ITO Ward 1(1) Ghaziabad V/s Ashok Kumar ITAT in the case of ITO Ward 1(1) Ghaziabad V/s Ashok Kumar Ghaziabad on 3 December 2018 [IT Appeal No. 2740 (Delhi) of 2018]. In Ghaziabad on 3 December 2018 [IT Appeal No. 2740 (Delhi) of 2018]. In Ghaziabad on 3 December 2018 [IT Appeal No. 2740 (Delhi) of 2018]. In view of the above it is requested to kindly give an opportunity to present of the above it is requested to kindly give an opportunity to present of the above it is requested to kindly give an opportunity to present my case to get the justice.” my case to get the justice.”

Having regard to the service rendered by the assessee’s father, who died Having regard to the service rendered by the assessee’s father, who died Having regard to the service rendered by the assessee’s father, who died

at the age of 70 years, in the organization like the National Council of at the age of 70 years, in the organization like the National Council of at the age of 70 years, in the organization like the National Council of

Educational Research and Training (NCERT), the deposit of cash of ional Research and Training (NCERT), the deposit of cash of ional Research and Training (NCERT), the deposit of cash of

Rs.6,57,000/- as claimed to be the cash kept with the father being his as claimed to be the cash kept with the father being his as claimed to be the cash kept with the father being his accumulated savings over his long career cannot be doubted. Rest of the amount accumulated savings over his long career cannot be doubted. Rest of the amount accumulated savings over his long career cannot be doubted. Rest of the amount

as withdrawal from the bank for medical expen as withdrawal from the bank for medical expenses incurred fo ses incurred for the father’s

treatment and further th treatment and further the household savings kept with the assessee household savings kept with the assessee, in the

present facts and circumstances is found to be acceptable. present facts and circumstances is found to be acceptable. The status, culture The status, culture

and practice of the assessee’s family does justify the case made out by the and practice of the assessee’s family does justify the case made out b and practice of the assessee’s family does justify the case made out b

assessee acceptable and, thus, the addition is deleted. The order, however, will acceptable and, thus, the addition is deleted. The order, however, will acceptable and, thus, the addition is deleted. The order, however, will

not be governed as a precedent. not be governed as a precedent.

In the result, appeal In the result, appeal filed by the Assessee is allowed.

Order pronounced in the open court on Order pronounced in the open court on 03.07.2026.

Sd/- (MADHUMITA ROY MADHUMITA ROY) JUDICIAL MEMBER JUDICIAL MEMBER

Dated: 03 July, 2026.

Dk Copy to:

MANOJ KUMAR, 316 BHOLANATH NAGAR, SHAHDARA 316 BHOLANATH NAGAR, SHAHDARA, 1 DELHI-110032, DELHI

INCOME TAX OFFICER, INCOME TAX OFFICER, OFFICE OF THE INCOME TAX OFFICE OF THE INCOME TAX OFFICER, 2 WARD 23(2), DELHI, NEW DELHI-110002, DELHI 110002, DELHI

3 THE PCIT / CIT, 4 THE D.R., ITAT, DELHI DELHIBENCH 5 GUARD FILE

MANOJ KUMAR,DELHI vs. INCOME TAX OFFICER, DELHI

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