Neeta Breja Vs ITO (ITAT Delhi)
Income Tax Appellate Tribunal (ITAT) Delhi allowed the appeal of Neeta Breja against the Commissioner of Income Tax (Appeals)’s order, which had confirmed an addition of ₹26,75,100 under Section 69 of the Income Tax Act for unexplained cash deposits in her Yes Bank account during Assessment Year 2010-11. The Assessing Officer (AO) had rejected the assessee’s explanation that the deposited cash was from earlier withdrawals from the same bank, citing a time gap between withdrawal and deposit. The CIT(A) upheld this. However, the ITAT relied on the assessee’s submitted cash flow statement, cash book, and bank statements with narrations, finding that the tax authorities failed to disprove the availability of the withdrawn cash with the assessee. Citing a similar ruling by the Delhi High Court in CIT vs. Kulwant Rai, the ITAT held that the AO’s suspicion about the cash being used for other purposes without any supporting evidence was insufficient to reject the assessee’s explanation. The ITAT concluded that merely a time gap between withdrawal and deposit does not warrant an addition under Section 69, especially when the revenue could not establish any other use of the withdrawn funds. Consequently, the ITAT reversed the orders of the lower authorities and allowed the assessee’s appeal.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
