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Judgment
PER AMITABH SHUKLA, AM,
This appeal by the assessee is directed against the order of Ld. Commissioner of Income Tax(Appeals)-24, New Delhi, [hereinafter referred to as 'ld. CIT(A)] dated 09.10.2025 arising out of assessment order dated 31.05.2021 passed under section 143(3) of the Income Tax Act, 1961, for the Assessment Year 2019-20. The word ‘Act’ herein this order would mean Income Tax Act, 1961.
The only issue arising the above appeal of the assessee through its grounds are regarding an addition of Rs.30,55,000/- by the ld. AO on account of unexplained cash deposits made in bank account.
Heard both the parties. Case filed perused.
The ld. Counsel for the assessee, Shri Gaurav Jain, took us through the brief factual matrix of the case. It was stated that the assessee had justified sources for the impugned cash deposits. The ld. Counsel informed that the appellant assessee is a senior citizen and had filed his return of Rs.65,21,560/-on 18.07.2019. It was submitted that a search action had taken place in the name of assessee on 25.06.2018, however, nothing incriminating was found. The ld. AO had noted that the assessee had deposited, between June, 2018 to February, 2019, an amount of Rs.30,55,000/- in its bank account with Axis Bank. On being queried, the assessee submitted that the same is related to cash withdrawals of Rs.29,75,000/-, made by assessee from the said bank account on earlier occasions between the period September, 2019 to January, 2019 and amounts received from relatives as gifts plus cash withdrawals of other family members. The ld. AO concluded that as no details for the reason of withdrawal, details of gifts, etc were coming from the assessee, the impugned deposits were unexplained. In appeal, the ld. CIT(A) confirmed the findings of the ld. AO by relying upon a plethora of case laws.
The ld. Counsel vehemently argued that nothing incriminating was found in search and that the cash deposits were linked to cash withdrawals from earlier occasions, gifts from relatives, etc.
The ld. DR placed reliance upon the orders of the lower authorities.
We have noted that main emphasis of the assessee is that the cash deposits of Rs.30,55,000/- are related to cash withdrawals of Rs.29,75,000/- on earlier occasions. Details of the deposits and withdrawals are available on page-4 and 5 of the appellate order. There is no dispute that the assessee has not provided to the lower authorities any details of gifts from relatives and cash withdrawals of family members. Perusal of the details of the deposits and withdrawals available on page-4 and 5 of the appellate order shows that cumulative amount of Rs.20 lakhs was withdrew on 20.09.2018, 24.09.2018 and 28.09.2018, however the only corresponding entry of cash deposit on 29.09.2018 is of Rs.6 lakhs. Thus, there is no semblance of any merit in the argument of cash deposit linked with cash withdrawal. We have seen that as against withdrawal of Rs.20 lakhs, only Rs.6 lakhs was deposited. Thus, there is a deficit of Rs.14 lakhs. We have noted that on another occasion deposit of Rs.2.25 lakhs on 07.12.2018 can be attributed to withdrawal of even amount on 19.11.2018. Then again, deposits of Rs.7 lakhs on 02.02.2019 can have some relation with withdrawal of Rs.2 lakhs on 28.01.2019 though leaving again a gap of Rs.5 lakhs. Considering the impugned anomalies and discrepancies and absence of any firm evidence, we are of the opinion that in the interest of justice, it would be suffice if the addition of the AO is restricted to Rs.20 lakhs. We, therefore, set-aside the order of the lower authorities and direct the ld. AO to delete the addition of Rs.10,55,000/-out of total addition of Rs.30,55,000/-.
In the result, the appeal of the assessee is partly allowed.