Arun Ashar Vs DCIT (ITAT Mumbai)
In a significant ruling, Mumbai ITAT in Arun Ashar v. DCIT quashed additions made u/s 69A, holding that assessee could not be deemed the owner of unaccounted cash merely by receiving it on behalf of another.
Based on the statement of Ms. Nayna Pasta (assessee’s sister), AO alleged that ₹1 crore received in two tranches was routed via her to Assessee, for eventual use by their brother Mr. Pravin Ashar. The source of funds was linked to Rajiv Saxena & an offshore entity transaction. Assessee admitted receiving the cash on behalf of his brother, not for himself. He passed the money to Mr. Pravin Ashar’s children & used a small portion, with all transactions confirmed by the persons involved.
Tribunal emphasised that ownership is a key condition for invoking Sec 69A. Relying on D.N. Singh v. CIT (SC) & CIT v. Anoop Jain (Delhi HC), it held that assessee merely acted as a conduit & was not the owner of the cash. The explanation regarding the nature & source of the funds was consistent & corroborated by all parties. e AO did not disprove the claim nor establish that the cash belonged to Assessee.
