The Income Tax Appellate Tribunal (ITAT), Indore bench has held that the past savings kept in the bank locker cannot be treated as Unexplained Investment merely for the reason that the amount was not deposited in the Bank.
A search carried out in the premises of the assessee revealed an amount of 9.25 lakhs in locker of Bank of India. The assessee explained that the cash found was savings of the assessee and his spouse retained for assessee’s daughter’s marriage. These amounts were deposited in the locker out of the savings of his wife and himself in more than 5 years. However, the AO ignored the explanation and made addition under Section 69A of the Income Tax Act.
The first appellate authority confirmed the addition by holding that the explanation given by the assessee is not convincing for the reason that a person would go, operate the locker and keep cash there from time to time, whereas depositing cash in the bank or making a FDR is a better and easier option. Against the order, the assessee approached the Tribunal for relief.
The Tribunal noted that the assessee has fully explained the sources and he has discharged the burden casted upon him.
“The A.O. without giving any basis, rejected the explanation of the assessee. In our opinion, the A.O. is not correct. In so far as Ld. CIT(A) is concerned, he is of the opinion that instead of keeping money in the locker, it is better to deposit in the bank so that the assessee may earn the interest. In our opinion, the assessee is the person who has to decide himself whether to keep the money in the locker or deposit in the bank. In this case, the assessee has decided to keep money in the locker to perform his daughter’s marriage and explained the sources. In view of the above, we find that the order passed by Ld. CIT(A) has to be reversed,” the Tribunal said.
Subscribe Taxscan Premium to view the Judgment
