RABINDRA NATH MOHANTY,BHUBANESWAR vs. ITO, WARD-3(4), BHUBANESWAR

ITA 91/CTK/2026Status: DisposedITAT Cuttack30 September 2026AY 2017-184 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the addition of Rs. 16,90,000/- as unexplained cash credit was not justified. The Tribunal noted that the assessee was a pensioner with no other income besides pension and interest. The Assessing Officer himself had accepted Rs. 2,50,000/- as a plausible source of cash holding. The Tribunal found no evidence to suggest the assessee earned any other income. The assessee's claim that the money was kept for his son's marriage was considered a plausible explanation that had not been found to be false. Therefore, the addition made by the Assessing Officer and confirmed by the CIT(A) was deleted. The ratio decidendi is that if an assessee provides a plausible explanation for cash deposits, and the revenue fails to disprove it or establish any other source of income, the addition under Section 69A is unwarranted.

What were the facts?

The assessee, Rabindra Nath Mohanty, a retired senior clerk, appealed against the order of the NFAC, Delhi, for assessment year 2020-21. The assessee, who lives on pension and bank interest, deposited Rs. 19,40,000/- in his bank account between November 9, 2016, and December 30, 2016, during the demonetization period. The Assessing Officer treated Rs. 16,90,000/- of these deposits as unexplained income, accepting only Rs. 2,50,000/- as a plausible source. The assessee contended that he had withdrawn funds in earlier periods, maintained a cash book, and the accumulated cash was used for children's expenses and his son's marriage. The revenue argued that the assessee failed to explain the source and custody of the withdrawn cash.

What were the issues?

1. Whether the addition of Rs. 16,90,000/- as unexplained cash credit in the hands of the assessee for assessment year 2020-21 is justified, turning on the provisions of Section 69A of the Income Tax Act, 1961. Assessee's contentions: The assessee argued that the deposits represented cash withdrawn in earlier periods, supported by a cash book. The accumulated cash was intended for his son's marriage and other expenses. He had no other source of income, and the revenue could not demonstrate any other source. The assessee relied on the plausibility of his explanation regarding accumulated cash. Revenue's contentions: The revenue contended that the assessee failed to demonstrate where he kept the withdrawn cash and how it was preserved. It was the assessee's responsibility to explain the source of the cash deposited, not the department's duty to prove the source of income.

Which sections of the Income-tax Act were involved?

Section 69A

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Income Tax Appellate Tribunal, CUTTACK BENCH CUTTACK

Before: SHRI GEORGE MATHAN & SHRI GOPALAN GURUSAMY

Hearing: 30/09/2026Pronounced: 30/09/2026

Per Bench: This is an appeal filed by the assessee against the order of the NFAC, DELHI [hereinafter referred to as the ‘CIT(A)’] in appeal no.NFAC/2020-21/10501124 dated 11.03.2026 for the assessment year 2020-21. 2. Shri S. K. Agarwalla, AR appeared on behalf of the assessee and Shri Vijay Singh, Sr. D.R. represented on behalf of the revenue.

3.

It was submitted by the ld. AR that the assessee was working as senior clerk in the state government department and he retired in 2009. It was the submission that he is living on his

The order continues below.

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