Rajendra Gadhia Vs ITO (ITAT Ahmedabad)
ITAT Ahmedabad held that addition u/s. 69A of the Income Tax Act reduced with the amount of cash withdrawals which is satisfactorily explained through documents. Held that once cash withdrawals are demonstrated, the burden shifts to the Department to disprove their availability for subsequent deposits.
Facts- The assessee is an NRI. During the demonetization period, the assessee made cash deposits of Rs.6,00,000/- each in his bank account. The case was selected for scrutiny, and the AO questioned the source of these cash deposits. The assessee explained that the funds were accumulated from cash withdrawals from his bank accounts and from the money left over from USD withdrawals made from his Bank of America (BOA) account during his visits to India between 2012 and 2015. The assessee also submitted that the cash corpus was given to family members for social and medical purposes, and that his brother, Shri Mahesh Gadhia, acted as the custodian of these funds. During demonetization, the family returned the money, which was then deposited in the bank.
AO, however, was not convinced by the explanation. Thus, AO added Rs.12,00,000/- as unexplained income u/s. 69A of the Act and also initiated penalty proceedings u/s. 271AAC of the Act. CIT(A) upheld the addition. Being aggrieved, the present appeal is filed.
