Loading judgment…
Facts
The assessee deposited Rs. 53,77,500 in cash during the demonetization period, which was questioned by the Assessing Officer. The assessee submitted that the cash represented consideration of Rs. 60,00,000 received from her brothers in Indian currency for relinquishing her interest in ancestral property in Nepal, supported by a settlement deed and affidavits. The AO made an addition for unexplained cash, which was confirmed by the CIT(A).
Held
The Tribunal found that the assessee had adequately explained the source of the cash deposit by producing a registered settlement deed and affidavits from her brothers confirming the payment for relinquishment of her share in ancestral property. Although the manner of keeping the cash-in-hand was not fully explained, the Tribunal held that this did not invalidate the explanation of the source, and therefore, the addition made by the AO and confirmed by the CIT(A) was deleted.
Key Issues
Whether the cash deposit made during demonetization, explained as consideration received from relinquishing ancestral property rights in Nepal, constitutes a satisfactory explanation for the source of funds.
Sections Cited
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, IN THE INCOME TAX APPELLATE TRIBUNAL,
Before: S/HRI GEORGE MATHAN & RATNESH NANDAN SAHAYRATNESH NANDAN SAHAYRATNESH NANDAN SAHAY
O R D E R Per Bench This is an appeal filed by the assessee against the order of the ld This is an appeal filed by the assessee against the order of the ld This is an appeal filed by the assessee against the order of the ld CIT(A), CIT(A), NFAC, NFAC, Delhi Delhi dated dated 21.2.2024 in in Appeal Appeal No.CIT(A), No.CIT(A), Hazaribag/10199/2019 Hazaribag/10199/2019-20 for the assessment year 2017-18 18.
Shri M.K.Choudhury M.K.Choudhury, ld AR appeared for the assessee. Shri ed for the assessee. Shri Khubchand T Pandya, Khubchand T Pandya, ld Sr DR represented on behalf of the revenue. represented on behalf of the revenue.
It was submitted by ld AR that the assessee is an individual, who is It was submitted by ld AR that the assessee is an individual, who is It was submitted by ld AR that the assessee is an individual, who is deriving income from house property and interest income. It was the deriving income from house property and interest income. It was the deriving income from house property and interest income. It was the submission that during the impugned assessment year, the assessee had submission that during the impugned assessment year, the assessee had submission that during the impugned assessment year, the assessee had P a g e 1 | 4 Assessment Year : 2017-18 deposited Rs.53,77,500/- in cash in her bank account during the demonetization period. It was the submission that the Assessing Officer had questioned the source of deposit. The assessee had submitted that the assessee relinquished her interest in her ancestral property in Nepal and had received the shares in cash from her property. It was the submission that as the assessee has given explanation and the affidavits of the brothers, which has also been produced before the Assessing Officer as also the copy of the relinquished deed which is registered, it was the prayer that the addition made by the AO and confirmed by ld CIT(A) be deleted.
In reply, ld Sr DR submitted that the money has come from Nepal and the assessee has not been able to show how the money was kept till it was deposited in the bank account. It was the submission that the assessee has claimed that she has received Rs.60,00,000/- from her brothers and how she has kept the money at home or cash in hand has not been explained. It was the prayer that the order of the ld CIT(A) be upheld.
We have considered the rival submissions. A perusal of the facts in the present case clearly shows that the assessee has produced the settlement deed between the assessee and her brothers. The settlement deed clearly mentions the assessee having received the consideration of Rs.60,00,000/- in Indian currency for her relinquishing the interest from the father’s property. The relinquished deed also recognizes the death of the P a g e 2 | 4 Assessment Year : 2017-18 assessee’s father as also the number of brothers and sisters. As per relinquished deed alongwith her brothers and sisters are nine children. father. The total value of the father’s property is shown as Rs.8.66 crores in Nepal Ruppaya. The assessee’s share would be approximately Rs,96,00,000/- in Nepal currency. This would be equivalent to Indian currency of Rs.60,00,000/-. The assessee’s brothers have also confirmed that they have given cash to the assessee. This being so, we are of the view that the assessee has given explanation in respect of cash deposit in the bank account. How the assessee has kept the money in her hand as cash in hand is admittedly for the assessee to explain but that does not become the foundation for an addition in respect of cash deposited in the bank account of the assessee. This being so, the addition as made by the AO and confirmed by ld CIT(A) stands deleted.
In the result, appeal of the assessee stands allowed.
Order dictated and pronounced in the open court on 20/08/2025.