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Facts
The appeal by the assessee for AY 2011-12 arose from an order confirming the addition of Rs. 5,29,500/- as unexplained money. The original assessment was framed u/s 144 r.w.s 147 of the Act.
Held
The Tribunal found that the additions were sourced from earlier cash withdrawals and agricultural rental income. The benefit of agricultural rent and earlier cash withdrawals were considered and accepted.
Key Issues
Whether cash deposits can be treated as unexplained money when their source is explained through agricultural income and earlier cash withdrawals.
Sections Cited
144, 147, 69A
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Income Tax Appellate Tribunal, “A” BENCH, CHANDIGARH
Before: HON’BLE SHRI LALIET KUMAR, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM
O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2011-12 arises out of an order of learned Commissioner of Income Tax (Appeals), NFAC [CIT(A)] dated 19-08-2025 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s 144 r.w.s 147 of the Act on 28-03-2025. Having heard rival submissions, the appeal is disposed-off as under.
Initially, the case of the assessee was reopened and an assessment was framed against the assessee on 26-12-2018 making addition of cash deposit for Rs.18.92 Lacs. The matter ultimately reached before Tribunal, wherein vide order dated 28-04-2023, the matter was restored back to Ld. AO for fresh assessment in the light of assessee’s additional evidences. Pursuant to the same, another assessment has been framed on 28-03-2025 which has again been assailed before us.
During the course of the latest assessment proceedings, the assessee was directed to establish the source of cash deposit of Rs.18.92 Lacs as deposited by him in Axis Bank Account during the period from 19-05-2010 to 14-01-2011. The assessee furnished various details and computations which include capital gains of Rs.11,62,500/- on sale of agricultural land which was accepted by Ld. AO. The source of Rs.2 Lacs was also accepted. However, the remaining deposit of Rs.5,29,500/- were added by Ld. AO as unexplained money u/s 69A though the assessee stated that the same was sourced out of earlier cash withdrawals and agricultural rental income. The Ld. CIT(A) confirmed the addition against which the assessee is in further appeal before us.
We find that the addition of Rs.2,39,500/- is out of deposits made on 19-05-2010 & 20-05-2010. The addition Rs.2.50 Lacs represents deposit on 12-07-2010 and the remaining addition of Rs.0.40 Lacs represents deposit on 14-01-2011. The Ld. AR stated that the benefit of agricultural rent of Rs.1.40 Lacs has not been granted to the assessee. The same is supported by the affidavit of agricultural tenant. The Ld. AR also sought benefit of earlier cash withdrawals as made by the assessee. It has been pointed out that the assessee has made cash withdrawal of Rs.1.70 Lacs on 08-05-2010. The assessee, apparently, has also received agricultural rent of Rs.1 Lacs in 17-05-2010. If these two items are considered, the addition of Rs.2,39,500/- could not be sustained. Similarly, the assessee has made substantially withdrawals of Rs.13.40 Lacs prior to 12-07-2010 & 14-01-2011 and therefore, in the absence of any other utilization of cash, the source of these two deposits could also be accepted. Therefore, we accept the prayer of Ld. AR and delete the impugned addition of Rs.5,29,500/- in toto.
The appeal stand allowed. Order pronounced on 11th March, 2026.