BYEREDDY MADHAVILATHA,HYDERABAD vs. INCOME-TAX OFFICER, WARD 8(1), HYDERABAD, HYDERABAD

The grounds raised by the assessee read as under: “1. That on facts and circumstances of the case and in law, the order u/s 143(3) of the I.T. Act, 1961 is bad in law. 2. That on the facts and circumstances of the case, the learned Assessing Officer/CIT (A) erred in carrying out an addition towards unexplained money u/s 69A of the Act amounting to Rs.5,00,000/-.

Facts of the case, in brief, are that the assessee is a non-resident, filed her return of income declaring total income of Rs.70,990/-. The case was selected for scrutiny under CASS for the reasons of deposit of cash during the demonetization period. During the course of assessement proceedings , the Assessing Officer noticed that the assessee has made cash deposits of Rs.5,25,000/-. Further the assessee had also deposited during demonetization period on 3 dates amounting to Rs.5.00 lakhs into her bank Account maintained with State Bank of Hyderabad, Ramachandrapuram Branch. The Assessing Officer called upon the assessee to explain the source for cash deposits. In response the assessee vide letter dated 21.11.2019 submitted that she had received gift from her father-in-law amounting to Rs.5.00 lakhs and the same has been deposited into her bank account. The assessee has filed necessary affidavit from her father-in-law and also various other evidences to prove the source for her father-in- law. The Assessing Officer however, was not convinced with the explanation furnished by the assessee and according to the Assessing Officer, the assessee could not satisfactorily explain with necessary documentary evidences regarding the source for cash deposits during the demonetization period amounting to Rs.5.00 lakhs and thus made addition of Rs.5.00 lakhs u/s 69A

The assessee carried the matter in appeal before the first appellate authority and the learned CIT (A) for the reasons stated in the appellate order dated 16.03.2024, rejected the explanation furnished by the assessee and sustained the addition made towards cash deposits u/s 69A r.w.s. 115BBE of the I.T. Act, 1961.

Aggrieved with such order of the learned CIT (A), the assessee is in appeal before the Tribunal.

The learned Counsel for the assessee submitted that the learned CIT (A) erred in sustaining the addition made towards the cash deposits u/s 69A of the Act without appreciating the fact that the assessee has explained the source for cash deposits out of known source of income which is the amount of gift received from her father-in-law. The learned Counsel for the assessee referring to the affidavit filed by one Mr. Bala Reddy submitted that the assessee has received gift of Rs.5.00 lakhs from her father-in-law and has filed an affidavit along with necessary evidences to prove the availability of source for the said gift. The Assessing Officer and the learned CIT (A) ignoring all the evidences filed by the assessee has made addition towards cash deposits u/s 69A of the Act only for the reasons that the said cash deposit was made during the demonetization period.

The learned DR, on the other hand, supporting the orders of the Assessing Officer and the learned CIT (A) submitted that the so-called gift received by the assessee from her father-in- law is in cash. The assessee could not furnish evidence to prove the source for the deposits. The Assessing Officer and the learned CIT (A) after considering the relevant fact has rightly made addition towards the cash deposits u/s 69A of the Act and their orders should be upheld.

I have heard both the parties, perused the material available on record and gone through the orders of the authorities below. The appellant claims to have received gift from her father- in-law in cash before the demonetization period and further when the demonetization was announced in Nov.2016, the same was deposited into her bank account maintained with SBH Ramachandrapuram Branch. The Assessing Officer never disputed the fact that the assessee has filed an affidavit from Shri Bala Reddy to prove the receipt of gift in cash. The Assessing Officer made addition only on the ground that the appellant could not furnish further evidences to justify the source for the donor to explain the gift given to the assessee. Except this, there is no other valid reason is given by the Assessing Officer to make addition towards cash deposits u/s 69A of the Act. On the other hand, the assessee has furnished all evidences including affidavit from the donor and various other evidences including the evidence for land holding and also a certificate from the concerned authority to prove carrying out of agricultural operation and earning agricultural income. When the evidences filed by the assessee are sharing at us, just because the cash deposit was

In the result, appeal filed by the assessee is allowed. Order pronounced in the Open Court on 21st May, 2024. Sd/ (MANJUNATHA, G) ACCOUNTANT MEMBER Hyderabad, dated 21st May, 2024 Vinodan/SPS Copy to: S.No Addresses 1 Shri Byereddy Madhavilatha, H Block, 1902 Aparna Sarovar Grande, Near Citizen Hospital, Nallagandla, Serilingampaly, R.R. Distt.500019 2 Income Tax Officer Ward 8(1) Signature Towers, Sy. No.6(P) of Kondapur, Opp: Botanical Gardens, Serilingampally, R.R. Distt. 3 Pr. CIT – Hyderabad 4 DR, ITAT Hyderabad Benches 5 Guard File