Nagina Nusrath Vs ITO (ITAT Bangalore)
ITAT Deletes Section 69 Addition Where Investment Was Made Through Tenant’s Cheque and Properly Explained
The Bangalore ITAT deleted an addition of ₹5 lakh made under section 69, holding that an investment cannot be treated as unexplained when the source and mode of payment are clearly evidenced through contemporaneous documents. The Tribunal found that the Revenue authorities had incorrectly assumed that the assessee had made a cash investment in M/s I Monetary Advisory, whereas the records established that the payment was made through a cheque issued by a tenant pursuant to a lease arrangement.
The assessee explained that her husband had received a lease advance of ₹15 lakh from a tenant. As per his instructions, the tenant directly issued a cheque of ₹5 lakh in favour of M/s I Monetary Advisory towards an investment made in the assessee’s name. The cheque details were duly reflected in the lease documentation, and supporting evidence including the lease agreement and cheque records was furnished before the authorities.
The Tribunal observed that the impugned cheque was specifically identifiable and was linked to the lease transaction between the assessee’s husband and the tenant. Since the investment was made through an identifiable banking channel and the source stood explained through documentary evidence, there was no basis to treat the amount as unexplained investment under section 69.
Accordingly, the Tribunal held that the addition was unsustainable, set aside the order of the CIT(A), and directed the Assessing Officer to delete the entire addition of ₹5 lakh. Since the assessee succeeded on merits, the legal grounds raised in the appeal were treated as infructuous.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
The present appeal has been instituted by the assessee against the order of the Ld. CIT(A) passed u/s 250 of the Act dated 24.03.2026 relevant to AY 2023-24.
