AO Adds Rs. 5.38 Lakh as Unexplained Cash Deposit: ITAT Confirms Rs. 48,000 Addition as Taxpayer Fails to Prove Source [Read Order]
The Tribunal confirmed an addition of Rs. 48,000, citing the assessee’s inability to furnish sufficient evidence for the amount.
![AO Adds Rs. 5.38 Lakh as Unexplained Cash Deposit: ITAT Confirms Rs. 48,000 Addition as Taxpayer Fails to Prove Source [Read Order]](https://www.taxscan.in/wp-content/uploads/2025/04/Unexplained-Cash-Deposits.jpg "AO Adds Rs. 5.38 Lakh as Unexplained Cash Deposit: ITAT Confirms Rs. 48,000 Addition as Taxpayer Fails to Prove Source [Read Order]")
The Hyderabad Bench of the Income Tax Appellate Tribunal (ITAT) confirmed Rs. 48,000 as assessee failed to prove source of deposits in the case where the Assessing Officer (AO) had made an addition of Rs. 5.38 lakh as unexplained cash deposits. Shri Balineni Kishore Babu (the assessee), a Chartered Accountant by profession, had filed his return of income for AY 2017-18, declaring an income...
The Hyderabad Bench of the Income Tax Appellate Tribunal (ITAT) confirmed Rs. 48,000 as assessee failed to prove source of deposits in the case where the Assessing Officer (AO) had made an addition of Rs. 5.38 lakh as unexplained cash deposits.
Shri Balineni Kishore Babu (the assessee), a Chartered Accountant by profession, had filed his return of income for AY 2017-18, declaring an income of Rs. 5,22,840. The return was selected for scrutiny under CASS due to high-value cash deposits during the demonetization period.
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The AO noted total cash deposits of Rs. 14.80 lakh in the assessee’s bank accounts and sought justification for the source of these funds. The assessee submitted that Rs. 5.38 lakh was received from relatives and clients for self-assessment tax payments.
The AO found the explanations lacking documentary support and added the entire Rs. 5.38 lakh under unexplained money. Aggrieved by the order of the AO, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) [CIT(A)].
The CIT(A) rejected the contention of the assessee and upheld the addition made by the AO. Aggrieved by the order of CIT(A), the assessee filed an appeal before ITAT.
The counsel for the assessee submitted explanations including receipts from his mother Smt. Balineni Chinamma (Rs. 2.96 lakh), clients (Rs. 94,000). The counsel prayed to delete the additions made by the AO.
On the other hand, the counsel for the revenue relied on the orders of lower authorities and sought to dismiss the appeal filed by the assessee.
The two-member bench comprising Manjunatha G. (Accountant Member) and Laliet Kumar (Judicial Member) observed that the assessee received money from his mother, clients and mother.
The tribunal also observed that the assessee has been able to demonstrate the source of Rs. 3.92 lakh out of the total Rs. 5.38 lakh. The tribunal further noted that Rs. 1 lakh received from the uncle but Rs. 48,000 was unexplained due to lack of material evidence.
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The Tribunal accepted Rs. 3.92 lakh as satisfactorily explained and acknowledged an additional Rs. 1 lakh from the uncle. The tribunal upheld the remaining addition of Rs. 48,000 as assessee unable to prove source.
The appeal of the assessee was partly allowed.
To Read the full text of the Order CLICK HERE
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