ITAT Bangalore Deletes Sec. 69A Addition on Cash Re-deposit Out of Explained Loan Withdrawals

Sathya Reddy Vs ITO (ITAT Bangalore) The Bangalore ITAT held in favour of the assessee where the CIT(A), after deleting the AO’s original addition on cash withdrawals, made a fresh addition of Rs. 75.16 lakh in respect of cash re-deposits. The Tribunal found that this fresh addition was unsustainable both on procedure and on merits. It noted that the CIT(A) had changed the very basis of the addition from withdrawals to deposits without issuing a proper enhancement notice, which violated principles of natural justice. On merits also, the Tribunal accepted that the source of the cash was duly ...