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Facts
The assessee deposited Rs. 15,26,000/- in a bank account during the demonetization period, which the Assessing Officer added as unexplained cash and the ld.CIT(A) confirmed. The assessee contended that this amount was a re-deposit of cash withdrawn in March 2016 from a Rs. 20 lakh bank loan, which was then kept as cash-in-hand before being re-deposited in November 2016.
Held
The Tribunal upheld the order of the ld.CIT(A), finding that the assessee failed to provide any justification for keeping a substantial amount of cash at home from a loan sanctioned for a specific purpose (cold storage). The Tribunal found no reason to interfere with the ld.CIT(A)'s decision.
Key Issues
Whether the ld.CIT(A) was justified in confirming the addition of unexplained cash deposits made during demonetization, when the assessee claimed it was a re-deposit of cash withdrawn from a bank loan taken for a specific purpose, but provided no justification for holding the cash.
Sections Cited
250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD
Before: SHRI SANJAY GARG
Assessment Year : 2017-18 Hasmukh Ramanlal Patel The ITO, C/o. M/s.Bhikhalal Ramanlal Patel Vs Ward-3(2)(2) Nr.Borring, ST Road Ahmedabad. Sanand PAN:ABCPP 2170 K (Applicant) (Responent) Assessee by : Shri S.N. Divatia, AR : Revenue by Shri Ravindra, ld.SR.DR सुनवाई क� तारीख/Date of Hearing : 17/12/2025 घोषणा क� तारीख /Date of Pronouncement: 24 /12/2025 आदेश/O R D E R आदेश आदेश आदेश
The above appeal has been preferred by the assessee against order passed by the Ld.Commissioner of Income-Tax(Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “ld.CIT(A)] dated 05.06.2024 under section 250 of the Income Tax Act, 1961 ("the Act" for short) for the assessment year 2017-18.
The assessee, in this appeal, is aggrieved by the action of the ld.CIT(A) in confirming addition made by the Assessing Officer (“AO” for short) of Rs.15,26,000/- as unexplained cash deposits in the bank account of the assessee during the demonetization period.
The appeal of the assessee is time barred by 220 days. A separate application has been filed for condonation of delay. Considering the averments made in the application, the delay in filing the appeal before the Tribunal is condoned.
2 4. Brief facts of the case are that the assessee had deposited an amount of Rs.15,26,000/- during the demonetization period in his bank account with Naroda Nagrik Cooperative Bank Ltd., Ahmedabad. Though the assessee was specifically asked to explain the source of the impugned deposit of Rs.15,26,000/- in the bank account with the above bank, the assessee did not file any reply and did not furnish the source of deposits before the AO. The AO, therefore, made addition of Rs.15.26 lakhs. Being aggrieved of the said order, the assessee went in appeal before the ld.CIT(A).
The assessee explained before the ld.CIT(A) that the assessee had taken loan of Rs.20 lakhs from the bank, which was disbursed to him on 15.3.2016 and the same was transferred to his saving bank account with Naroda Nagarik Co-op. Bank Ltd. on 15.3.2016. Further that there was a cash withdrawal of Rs.7.00 lakhs on 22.3.2016 and Rs.8.16 lakhs on 29.3.2016, thus aggregating to Rs.15.16 lakhs, which was kept in his hand and re-deposited on 10.11.2016 and 11.11.2016 in the said loan account with the bank.
The ld.CIT(A), however, noted that the assessee during the course of appellate proceedings had not furnished any documentary evidence to substantiate his claim. He, therefore, dismissed the appeal of the assessee.
Being aggrieved of the said order of the ld.CIT(A), the assessee has come in appeal before us.
I have heard rival submissions and gone through the record.
The case of the assessee is that the assessee had taken loan of Rs.20.00 lakhs from the bank which was deposited in his saving bank account on 15.3.2016. It has been further claimed that the assessee 3 had withdrawn cash of Rs.7.00 lakhs on 22.3.2016 and Rs.8.16 lakhs on 29.3.2016, and that it was re-deposited in the loan account in the month of November, 2016. It was mentioned that the assessee had obtained loan of Rs.20 lakhs on account of cold-storage account, which apparently showed that the assessee was indulged in the some activity and the assessee had obtained loan from the bank for the some specific purpose. On being asked to explain in this respect, the ld.counsel for the assessee could not explain the reasons for what purpose loan was taken by the assessee, and why the cash was kept at his house, out of the withdrawals made after obtaining the loan of Rs.20 lakhs. It is commonly known that the loan is often taken for some specific need, and the same is also disbursed by the bank for specific reasons/grounds, which in the case of the assessee has been mentioned as cold storage, “S.R. Cold Storage”. Since the amount of loan was granted by the bank for the specific purpose, it was likely that the amount withdrawn was used by the assessee for that specific purpose. No justification could be given by the ld.counsel for the assessee for such cash, as cash-in-hand. Therefore, I do not find any reason to interfere with the order of the ld.CIT(A) in this respect, and the same is upheld.
In the result, the appeal of the assessee stands dismissed. Order pronounced on 24th December, 2025.