Mohan Lal Bhapta Vs ITO (ITAT Chandigarh)
This appeal concerns the assessee’s challenge to the order dated 27 December 2024 passed by the CIT(A)-1, Coimbatore, for Assessment Year 2017–18, which had upheld an addition of ₹11,24,000 as unexplained money under Section 69A of the Income-tax Act. The assessee, an individual deriving income from pension and horticulture, filed a return declaring total income of ₹2,73,150 and agricultural income of ₹4,83,116. During scrutiny, the Assessing Officer (AO) observed cash deposits during the demonetization period amounting to ₹11,24,000—of which ₹2,63,000 was deposited in Canara Bank and ₹8,61,000 in Punjab National Bank.
The assessee explained that these deposits originated from cash withdrawn from a housing loan jointly sanctioned to him, his wife Shanti Devi, and son Rajesh Kumar by Canara Bank shortly before demonetization. The loan timeline showed that ₹10,00,000 was disbursed on 27 September 2016 into his wife’s account, from which ₹9,00,000 was withdrawn in cash and ₹1,00,000 transferred to the assessee’s account and withdrawn. A second installment of ₹3,00,000 was released on 17 October 2016, transferred to the assessee’s account and withdrawn the same day. The assessee submitted that this money remained unutilized because construction for which the loan was obtained was halted due to his wife’s illness and hospitalization at IGMC, Shimla. After demonetization was announced, he deposited the unutilized amount of ₹11,10,000 into his two bank accounts.
