Vivek Kamalkar Kadam Vs ITO (ITAT Mumbai)
Addition u/s 69A was sustained by CIT(A) in respect of ₹12.50 lakh cash deposits, treating them as unexplained despite Assessee’s claim that deposits represented repayment of a friendly loan advanced earlier to Shri Gulamnabi Gafoor Shaikh. Tribunal noted that loan of ₹25 lakh, repayment of ₹5 lakh by cheque & ₹7.5 lakh by cash were already accepted by Revenue; only balance ₹12.5 lakh was disputed due to non-availability of deposit slips & alleged failure to prove availability of cash with borrower. ITAT held that Assessee had discharged the primary onus by furnishing confirmation & affidavit of borrower, his ITR, audited financial statements showing substantial turnover & net worth, thereby establishing identity, creditworthiness & genuineness of transaction. Tribunal further held that Assessee cannot be expected to prove “source of source” or compel bank/third party compliance, & Revenue failed to rebut evidence by any adverse material. Accordingly, addition of ₹12.50 lakh u/s 69A was deleted in full & appeal allowed.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This is an appeal filed by the Assessee against the order of the Ld. ADDL/JCIT(A)-6, Delhi, dated 30-07-2025, pertaining to Assessment Year (AY) 2016-17, wherein the Assessee has taken the following grounds of appeal:
“1. On facts and circumstances of the case and in law, the learned CIT(A) erred in sustaining addition of 12,50,000/- u/s 69A of the Act, being part of loan repayment, ignoring that the Appellant had discharged the initial burden by providing comprehensive evidence of the source, including affidavit, confirmation, ITR, and audited accounts of Shri Shaikh, which establish identity, genuineness, and creditworthiness of the transaction.
2. On facts and circumstances of the case and in law, the learned CIT(A) failed to appreciate that once identity of the creditor, genuineness of the transaction, and capacity are demonstrated, no addition can be sustained in the hands of the appellant.
3. On facts and circumstances of the case and in law, the learned CIT(A) erred in placing undue reliance on non-response of third party to notice u/s 133(6), which is beyond the control of the appellant. The appellant cannot be penalized for non-compliance by an independent third party.
4. The learned CIT(A) erred in law and on facts in treating the affidavit and financials of the creditor as insufficient, contrary to judicial precedents holding that documentary evidence corroborates explanation under section 69A.
5. The learned CIT(A) erred in upholding levy of interest u/s 234B and 234D, which being consequential ought to be deleted if the addition is deleted.
6. The appellant craves leave to add, amend, modify or withdraw any ground of appeal at the time of hearing.”
2. The limited issue under consideration relates to source of cash deposit of Rs 12.50 lacs in the bank account maintained by the assessee.
