Manaki Natung Vs ITO (ITAT Guwahati)
Summary: The Guwahati Bench of the Income Tax Appellate Tribunal dismissed appeals filed by Manaki Natung against NFAC orders dated 22.09.2025 for AYs 2021-22 and 2022-23. In AY 2021-22, the dispute concerned an addition under Section 69A arising from cash deposits in the assessee’s bank accounts. The assessee claimed that she was a Scheduled Tribe member residing in Arunachal Pradesh and that her income was eligible for exemption under Section 10(26), while also explaining the deposits with reference to past cash withdrawals, savings and other income. The Tribunal noted that cash deposits during the year totalled Rs. 54,20,000/-, of which Rs. 13,39,652/- was accepted as rental income, while the remaining source was not established to its satisfaction. The Tribunal held that a valid source of income had to be established before the question of exemption under Section 10(26) could arise, and that merely producing bank statements could not substitute for books of account for establishing the source. It therefore dismissed ITA No. 364/GTY/2025 and, finding the issue identical, dismissed ITA No. 365/GTY/2025 for AY 2022-23 on the same terms. The common order was pronounced on 17.07.2026.
Relevant TaxGuru Coverage: The issue may be read alongside TaxGuru’s coverage of Section 10(26) and unexplained cash deposits, including Section 10(26) exemption for individual members of Scheduled Tribe, Section 10(26) exemption and the expression “residing in any area specified”, Section 69A cash deposit addition and source verification, and ITAT Guwahati decisions concerning cash deposits and Section 10(26).
