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Judgment
ORDER
Per Satbeer Singh Godara, Judicial Member: This assessee’s appeal for Assessment Year 2011-12, arises against the C IT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2025-26/1083750227(1) dated 16.12.2025, in proceed ings u/s 147 of the Income Tax Act, 1961 (in short “the Act”).
Heard both the p arties at length. Case file perused.
Coming to the assessee’s sole substantive ground raised herein, we notice at the outset w ith the able assistance coming from both the partie s that the lear ned CIT(A)’s action upho lding the assessment findings tre ating the assessee’s cash deposits of Rs.1,16,03,750/- as unexplained u/s 68 of the Act; reads as follo ws:
“5 . Ground Nos.2 , 3 & 4: All these gr ounds r aised by the appellant pertained to the si ngl e i ssue of additi on of Rs.1,16,03,750/-. Hence, all these grounds are taken up to gether for adjud ication.
5.2As per the i nformation available with the depar tment, appellant d eposited an amo unt of Rs.1,97,03,750/- in cash i n her savi ngs bank account mai nt ained wi th AXIS Bank Ltd, village Patti, district Tar an Tara n, Punjab. The assessment made u/s 147 of t he Ac t, dated 30/03/20 16 was set-aside by PCIT, Karnal u/s 263 of the Act vi de order dated 07/02/2018. Whi le gi vi ng eff ect to the or der u/s 263 of the Act, AO re quir ed the appel lant t o furni sh the explanati ons for t he cash d epos its made in her ba nk acco unt.
5.3Appella nt replied that she had sold an agricult ural land joi ntly with her sist er-in-law, S mt. Rajmeet Kaur on 19/05/2010 for a considerati on of Rs.48,50,000/-. Similarly, another agricult ural l and was sold by S mt. Gurnam Kaur , Mothe r-i n-law of the appellant, for consideratio n o f Rs.32,50,000/-. Appellant submitted tha t these sales consideration were received i n cash and the same was depo sited i n her bank acc ount . Appel lant also submitted that along with the abo ve menti oned amo unts of Rs.81,00,000/- (Rs .48,50,000/- + Rs.32,50,000/-), she had received a mounts fr om sal e of seas onal veget ables, cattle , agricultural equi pments, tr ees , gold and silve r orname nts and gifts received from brot her-i n-law were deposited i n t he ba nk acc ount. If t he abs ence of any doc umenta ry evidenc e furnishe d by the appellant, AO accepted only t he explanation with regard to Rs.81,00,000/- and trea ted the balance amo unt of Rs.1,16,00,000/-(Rs.1,97,03,750/- - 81,00,000/-) as unex plained cash and a dded the same to the inc ome for AY 2011-12.
5.4Duri ng the course of the appeal procee dings, appellant s ubmitt ed t hat s he was livi ng i n a j oint fami ly. The agricult ur al lands belongi ng to the joi nt family we re sold for tot al consi deration of Rs.2,37,33,500/- on 19/05/2010. Out of the a bove considerati on, a sum of Rs.37,70,000/- was received i n cash on the day of the agre ement i.e . 08/10/2009 and the balanc e of Rs.1,97,03,750/- was rec eived in cash on 19/05 /2010 on the day of the registration of the sale deed. The entire cash was deposite d in he r bank acco unt, Rs.37,70,000/-on 08/10 /2009 and Rs.1,97,03,750/- on 19/05/2010. Appellant submitted copies of the sale agreement. Appellant relied on t he decisio n in the case of V Na garajan Vs ITO (ITA T Che nnai), i n appeal no. ITA593/CHNY/2019 dated 18/05/2022. Appella nt submitt ed that the e ntire cash deposit was made out of the sale considerati on receiv ed towards sale of agric ultural l and. Sinc e the s ame was exempted from tax, with t he additio n of Rs.1 ,16,00,000/- was not taxabl e i n the hands of the appellant. Appellant requested the additi on m ay be d eleted.
5.5Appellant’s submissions were carefully considered. AO obs erve d t hat sal es considerations rec eived by t he appellant’s family on sal e of agricultural land was only Rs.81,00,000/-, as per the regis tered sale deeds . The sale agre ements cannot be consider ed a s evidence sinc e they we re not re gistered. Appell ant did not furnish any ot her documents in the for m of conf irmati on let ters from the buy ers t hat they had indeed given c as h over and above the considerati on mentioned i n t he sal e deed. Thus, in t he abs ence of a ny supporti ng docume nt, t he amo unt of Rs.1 ,16,00,000/- cannot be considered as s ale consideratio n received towar ds sal e of agric ultural land. In view of the above , t he addition of Rs.1,16,00,000/- is confirmed. Appeal on these grounds is dismiss ed.”
Bo th the parties vehemently reiterate the ir respective stand against and in support of the impugned addition. It is made clear that the assessee’s case all along right from day one is that the impugned cash deposits represent the cash component involved in her registered land sale transaction dated 19.05.2010 (supra). And that what all both the learned lower author ities have done is to accept the amount of the Collector rate stated in the sale deed as explained followed by the cash component addition made in her hand for ming the sole subject matter of tribunal’s apt adjudicatio n.
We have given our thoughtful consideration to the assessee’s and the Revenue’s respect stands. Learned counse l quotes Mrs. Malini Ramnath Re le Vs. ITO (1994) 49 ITD 43 (Bom.) that given the fact that the assessee’s land transaction(s) already stand proved, the necessary inference which would arise in her favour is that these cash deposits form part of the on-money component only. We wish to emphasize here that ho n’ble “Third Member” constitutes a “larger” bench u/s 255(4) of the Act; has already settled the controversy against the department regarding such an undeclared on-money component although the assessee has failed to plead and prove her case to the entire satisfaction of the learned lower authorities. There is further no dispute that no benefit o f her accumulated cash-in-hand and saving keeping in mind the relevant socio-economic status etc. has been granted to her. We take into co nsideration all these facts and circumstances in totality to conclude that a lump sum addition of Rs.5,00,000/-only in the asse ssee’s hands would be just and proper with a rider that the same shall not be treated as a precedent. The assessee gets relief of Rs.1,11,00,000/- in other words. Necessary computation shall fo llow as per law.
No other ground or argument has been pressed.
This assessee’s appeal is partly allowed.
Order Pronounced in the Open Court o n 28/07/2026.