Ashok Kumar Mehrotra Vs ITO (ITAT Delhi)
The ITAT Delhi allowed the assessee’s appeal and deleted the addition of ₹69.50 lakh made u/s 69A, holding that the cash deposits were fully explainable from disclosed cash withdrawals and opening cash balance and therefore could not be treated as unexplained money.
The Tribunal noted that the assessee had deposited cash in three bank accounts aggregating to ₹69.50 lakh. The assessee demonstrated, with documentary evidence, that:
- cash withdrawals during the year amounted to ₹48.66 lakh, and
- opening cash balance of ₹51.53 lakh was available as per the cash book of the immediately preceding year.
Neither the AO nor the NFAC disputed the genuineness of cash withdrawals or alleged that the opening cash balance was utilised elsewhere. In the absence of any such adverse finding, redeposit of cash to the extent of available cash cannot be doubted.
The ITAT held that section 69A is not attracted where the source of cash is duly explained and verifiable from records, and the authorities below had acted arbitrarily in rejecting the explanation without disproving the availability of cash.
Accordingly, the Tribunal quashed both the assessment order and the NFAC appellate order, and deleted the entire addition.
FULL TEXT OF THE ORDER OF ITAT DELHI
