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Facts
The assessee, an individual engaged in trading agricultural commodities, declared income at Rs. 300560/- for AY 2019-20. The business was closed in FY 2018-19. Cash of Rs. 26,50,000/- was deposited in a locker, claimed to be from sales, debtors, and gifts. The AO added this amount under Section 153A read with Section 69A and 115BBE.
Held
The Tribunal held that the assessee failed to provide adequate evidence to prove the nature and source of the cash deposits. Affidavits alone were insufficient, and no documentary evidence was produced to support the claims of gifts or payments from debtors and stock sales.
Key Issues
Whether the addition of Rs. 10,00,000/- (gifts) and Rs. 16,50,000/- (sales and debtors) as unexplained cash under Section 69A was justified in the absence of sufficient documentary evidence.
Sections Cited
143(3), 153A, 69A, 115BBE
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH “G”, NEW DELHI
Before: SHRI MAHAVIR SINGH & SHRI KRINWANT SAHAY
ORDER
PER MAHAVIR SINGH, VICE PRESIDENT :
This appeal by the assessee is arising out of the order of the Commissioner of Income Tax (Appeals-27), New Delhi in Appeal No. CIT(A), Delhi-27/10778/2018-19 dated 28.3.2023. Assessment was framed by the ACIT/DCIT, CC-20, New Delhi for the assessment year 2019-20 u/s. 143(3) of the Income Tax Act, 1961 (hereinafter referred the Act) vide his order dated 28.3.2023.
The effective grounds no.3 & 4 raised by the assessee read as under:-
“3. On the facts and circumstances of the case and in law, the CIT(A) erred in confirming the addition made by the AO of Rs. 10,00,000/- u/s. 69A of the Act by adding the cash gift received by the appellant from family members despite the fact that the evidence of gift received was submitted during the assessment proceedings and no further independent enquiry were made during assessment proceedings.
On the facts and circumstances of the case and in law, the CIT(A) erred in confirming addition of Rs. 16,50,000/- u/s. 69A of the Act ignoring the fact that appellant has stock and debtors as on 1.4.2018 of Rs. 15,71,946/- and Rs. 386831/- respectfully was duly accepted by the AO while passing the assessment order for AY 2018-19.”
The brief facts of the case are the assessee is an individual engaged in trading of agricultural commodities at Sadar Bazar, Delhi – 110 006. During the relevant assessment year appeal, the appellant has filed his return of income on 31.8.2019 income at Rs. 300560/-. As per the return filed by the assessee the nature of business has been shown as traders and the income has been shown under the head income from other sources, because during the FY 2018-19 the business was closed. The main business of the assessee was trading in agricultural commodities. The cash realized from sales, debtors, funds received from relatives was deposited in locker of the assessee as the cash was received from his own sources not from undisclosed income. During the relevant financial year total cash of Rs. 26,50,000/- was deposited in the locker no. 108, Faquir Chand Lockers and Vaults P Ltd. The deposit of cash in lockers
2 | P a g e is a regular practice of food grain items seller and purchaser and the same was adopted by the assesse. The made the addition of Rs. 26,50,000/- u/s. 153A of the act and treated the sum as unexplained money u/s. 69A r.w.s. 115BBE of the Act. Against the above, assessee preferred the appeal before the Ld. CIT(A), who vide his order dated 28.03.2023 dismissed the appeal of the assessee.
Aggrieved, assessee is in appeal before the tribunal.
At the time of hearing, ld. AR for the assessee submitted that the addition of Rs. 26.50 lacs made u/s. 69A r.w.s. 115BBE attributable to cash put in locker, the cash found in locker cannot be treated as unexplained cash without any supporting material to arrive at the conclusion. However, the assessee has submitted the source of cash deposited in the locker by way of affidavit given by the persons from whom gift was received. He further submitted that the assesse is a small time businessman engaged in trading of agricultural commodities at Sadar Bazar, Delhi and in earlier years the sales were in cash and the cash realized on sales was deposited in locker of the assessee. The parents and relatives of the assessee helped and gifted the money for running the business smoothly after demonetization period. Hence, he requested to delete the addition in dispute.
Per contra, Ld. DR relied upon the orders of the authorities below.
We have heard the rival contentions and perused the records. We find that before the lower authorities the assessee has only filed affidavits for gift amounting to Rs. 2 lacs claimed to be received from his father Sh. Tilak Raj, Rs.
3 | P a g e 2 lacs from his mother Smt. Rajdulari, Rs. 4 lacs from hsk grand mother and Rs. 2 lacs from his brother and the assessee has not produced any details of documentary evidence of source of fund for gifts by the above mentioned family members. It is noted that assessee has not produced any details and acknowledgements of ITRs for any assessment year filed by the above-stated family members to prove their income and capacity to give such amount of gifts. The assesse has not produced copy of bank statements of afore-stated family members to prove that cash was withdrawn from the bank accounts by the afore-stated family members. The assessee has not produced any justified cause as to why such huge amounts of gifts were received by him in cash and not through the banking channel, if source of cash in hand of afore-stated family members is justified. Merely filing of affidavit does not suffice the onus of the assessee to prove nature and source of cash amounting to Rs. 10 lacs. The assessee has also not filed any documentary evidence to rebut the view taken by the AO neither before the Ld. CIT(A) nor before the Tribunal.
6.1 In view of the aforesaid factual matrix, in our view the action of AO making an addition of Rs. 10 lacs u/s 69A of IT Act, 1961 was rightly affirmed by the Ld. CIT(A), which does not need any interference on our part, hence, we uphold the same and accordingly, the ground no. 3 is rejected.
As regards ground no. 4 relating to sustaining the addition of Rs. 16,50,000/- is concerned, we note that it was the contention of the assessEe that the amount of Rs. 16.50 lacs is out payments made by the debtors and sale 4 | P a g e of stock made by the appellant. It is noted that assessee was given sufficient opportunities to furnish the details of the payments, but no documentary evidence was furnished to prove that cash amounting to Rs. 16.50 lacs is out payment made by the debtors and sale of stock. We observed that the assessee has not filed complete address, copy of ledgers, confirmation from debtors and copy of acknowledgement of ITR filed by the debtors to prove his contention. The assessee has also not produced any justified cause as to why payments were made by the debtors in cash and not through the banking channel. If the payments were made by the debtors through banking channel, the appellant has not produced copy of bank statements showing withdrawals from bank account. The assessee has also not filed any documentary evidence to rebut the view taken by the AO neither before the Ld. CIT(A) nor before the Tribunal. Even the contention of the assessee is not proved by any documentary evidence that that assessee decided to wind up his business to start a new business at Naya Bazar, Delhi. The assessee’s case is not a voluntarily disclosure or voluntarily surrender of income and disclosed the unexplained cash to the department, hence, in view of section 69A was rightly held by the lower authorities that assessee has failed to explain nature and source of cash found and seized from locker.
7.1 In view of the aforesaid factual matrix, in our view the action of AO making an addition of Rs. 16.50 lacs u/s 69A of IT Act, 1961 was rightly
5 | P a g e affirmed by the Ld. CIT(A), which does not need any interference on our part, hence, we uphold the same and accordingly, the ground no. 4 is rejected.
In the result, the assessee’s appeal stand dismissed. Order pronounced in the open court on 13.11.2025.
Sd/- Sd/- (KRINWANT SAHAY) (MAHAVIR SINGH) ACCOUNTANT MEMBER VICE PRESIDENT Date: 06-02-2026 SRBhatnaggar Copy forwarded to: - 1. Appellant 2. Respondent 3. DIT 4. CIT (A) 5. DR, ITAT Assistant Registrar, ITAT, Delhi Benches
6 | P a g e