Bibhu Prasad Sahoo Vs ITO (ITAT Kolkata)
The Income Tax Appellate Tribunal (ITAT), Kolkata Bench, adjudicated an appeal filed by the assessee, Bibhu Prasad Sahoo, against the addition of ₹1,31,465 to his income for Assessment Year (AY) 2017-18. This amount represented cash deposited into the assessee’s bank account during the demonetisation period and was treated as unexplained cash by the Income Tax Department.
Factual Background and Lower Authority Findings
The assessee, an individual with a declared income primarily consisting of rental income from house property (₹7,15,295 on total rental receipts of ₹10,32,000) and interest income, was selected for scrutiny under the Computer Assisted Scrutiny Selection (CASS).
The Assessing Officer (AO) identified cash deposits totaling ₹1,55,565 made during the demonetisation window. Although the assessee had submitted details like computation of income and lease agreements, the AO held that the assessee failed to furnish a specific submission regarding the source of the deposits in one particular bank account. Consequently, the AO treated a portion of the deposit, ₹1,31,465, as unexplained money under Section 69A of the Income Tax Act, 1961, and added it to the assessee’s total income.
The Commissioner of Income Tax (Appeals) [CIT(A)] upheld the addition, confirming that the onus was on the appellant to establish the source of the cash deposits. While acknowledging the appellant’s claim that the deposits were out of rent received, the CIT(A) dismissed the appeal on the grounds that the appellant failed to submit explicit confirmations from tenants proving they paid the rent in cash. The CIT(A) confirmed the addition as unexplained investment under Section 69 of the Act.
