Ramchandra Singh Rana Vs ITO (ITAT Ahmedabad)
Demonetisation Cash Deposit of ₹10 Lakh Held Unexplained: ITAT Ahmedabad Upholds Addition u/s 69A Where ‘Past Withdrawals’ Story Fails
The Ahmedabad SMC Bench of the ITAT dismissed the assessee’s appeal and sustained addition of ₹10 lakh u/s 69A for AY 2017-18 in the case of Ramchandra Singh Rana vs. ITO, Ward-3, Gandhinagar (ITA No.1330/Ahd/2025, order dated 24-12-2025).
The assessee had deposited ₹10 lakh in cash during the demonetisation period (November 2016) and claimed that the source was past cash withdrawals made in December 2015 for proposed house renovation, which was later postponed. The explanation was rejected by the AO and affirmed by the CIT(A), noting that the withdrawals were nearly one year old and the bank statements clearly showed substantial intervening payments to builders, home décor vendors and even transfer of ₹4.50 lakh to a loan account, negating the claim that cash was retained intact till demonetisation.
The Tribunal agreed that it was implausible for the assessee to hold such large cash for nearly a year, especially when contemporaneous bank entries evidenced active utilisation of funds. Since the assessee also failed to file the return of income for the relevant year and could not establish a live nexus between withdrawals and redeposit, the explanation was held unsatisfactory. Accordingly, the ITAT found no infirmity in the CIT(A)’s order and confirmed the addition of ₹10 lakh as unexplained cash deposit u/s 69A, dismissing the assessee’s appeal
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
