Prasanna Purushottam Majalikar Vs ITO (ITAT Panaji)
Prior Bank Withdrawals Explain Cash Paid for Property Purchase; Panaji ITAT Deletes ₹6.80 Lakh Addition
The assessee, a non-resident individual, purchased a flat in Margao, Goa, for ₹18.80 lakh on 24 October 2019. Of the total consideration, ₹12 lakh was paid through account-payee cheque and ₹6.80 lakh in cash.
The AO was not satisfied with the source of the cash component and treated ₹6.80 lakh as unexplained money. The CIT(A) confirmed the addition.
Before the ITAT, the assessee produced his bank statements showing the following cash withdrawals before the property purchase:
- ₹50,000 on 8 April 2019;
- ₹1.50 lakh on 10 April 2019;
- ₹95,000 on 5 July 2019; and
- ₹4.60 lakh on 23 October 2019.
The total withdrawals amounted to ₹7.55 lakh, exceeding the cash consideration of ₹6.80 lakh. The final withdrawal of ₹4.60 lakh was made just one day before registration of the property.
The Tribunal held that the cash withdrawn from the assessee’s disclosed bank account, together with his regular income, adequately explained the source of the cash payment. Accordingly, the addition of ₹6.80 lakh under section 69A was deleted, and the assessee’s appeal was allowed.
FULL TEXT OF THE ORDER OF ITAT PANAJI
The captioned appeal at the instance of assessee pertaining to A.Y. 2020-21 is directed against the order dated 20.02.2026 framed by ld.CIT(A), Bengaluru-12 arising out of Assessment Order dated 29.05.2025 passed u/s.147 r.w.s.144C(3) of the Income Tax Act, 1961 (in short ‘the Act’).
2. The sole grievance of the assessee in the instant appeal is against the addition of Rs.6.80 lakhs made by the Assessing Officer for the unexplained money u/s.69 of the Act.
3. We have heard the rival submissions and perused the record placed before us. We observe that the assessee is a non-resident individual and during the year under consideration he purchased an immovable property on 24.10.2019 located at Flat S-3, MZ colony, Margao, Goa for a consideration of Rs.18.80 lakhs as per the registered purchase deed. An amount of Rs. 12 lakhs have been paid by the assessee through Account Payee cheque and Rs.6.80 lakh has been paid in cash. Ld. Assessing Officer was not satisfied with the explanation of the assessee regarding the source of cash which resulted into the impugned addition. Further, assessee failed to get any relief before CIT(A) and now the assessee has approached this Tribunal.
4. We have gone through the bank statement filed by the assessee in the paper book on 04.02.2026 and find that there has been cash withdrawals at Rs.0.50 lakhs, 1.50 lakhs, 0.95 lakh and 4.60 lakhs on 08.04.2019, 10.04.2019, 05.07.2019 and 23.10.2019 totalling to Rs.7.55 lakhs. We note that the date of purchase of the immovable property in question is 24.10.2019 and prior to that assessee had withdrawn the cash of Rs.7.55 lakhs which along with the regular income is sufficient to cover up the source of cash of Rs.6.80 lakhs paid by the assessee for purchase of the immovable property.
5. We therefore under the given facts and circumstances are of the considered view that since the assessee has explained the source of alleged cash payment of Rs.6.80 lakhs from the cash withdrawn from its declared bank account which is prior to the date of payment made for the purchase of immovable property, therefore impugned addition u/s.69A of the Act is uncalled for. Finding of ld.CIT(A) is reversed and the alleged addition of Rs.6.80 lakhs stands deleted. Grounds of appeal raised by the assessee are allowed.
6. In the result, the appeal of the assessee is allowed.
Order pronounced on this 18th day of August, 2026.
