₹4.24 Crore Received from Brother Treated as Unexplained Cash Credit: ITAT Upholds CIT(A) Deletion Citing Documentary and Third-Party Evidence [Read Order]
The tribunal found that documentary records, including a remittance advice showing “inheritance,” a memorandum of transfer, a notarized family arrangement, and a later-provided confirmation from the brother, credibly established the transaction’s genuineness.
Unexplained Cash Credit - ITAT- CIT(A) - Taxscan
Unexplained Cash Credit - ITAT- CIT(A) - Taxscan
The Mumbai Bench of Income Tax Appellate Tribunal ( ITAT ) citing documentary and third-party evidence, upheld the Commissioner of Income Tax(Appeals)[CIT(A)]’s order deleting the ₹4.24 crore addition made under Section 68 of Income Tax Act,1961, for unexplained cash credit received from the assessee’s brother.
The Revenue-assessee,challenged the CIT(A)’s 29.03.2025 order that deleted the ₹4.24 crore addition made by the Assessing Officer (AO) in 2017 under Section 68 as unexplained cash credit.In this case, the respondent-assessee,Sarla Murli Teckchandani,filed her return of income declaring ₹9,85,850. The case was taken up for scrutiny, during which it was found that she had received ₹4,24,97,520 in her bank account from her brother, claimed as consideration for relinquishing her 1/4th share in ancestral property.
The assessee produced documents including a remittance advice showing “inheritance” as the transfer purpose, a memorandum of transfer on the share certificate, a notarized family arrangement, and a release deed.
The AO rejected her explanation, citing the absence of her brother’s confirmation and the release deed stating no consideration, concluding that she had routed undisclosed income through her brother’s account. The addition was made under Section 68.
On appeal, she argued that the payment was received under the family arrangement before the release deed and later, in 2018, furnished her brother’s confirmation. The CIT(A) accepted her contentions and deleted the addition, which was then challenged in the present appeal.
The two member bench comprising Justice (RETD.) C.V.Bhadang (President) and Vikram Singh Yadav (Accountant Member) considered the submissions and examined whether the respondent-assessee had satisfactorily explained the source of ₹4,24,97,520.
It noted that while the release deed stated the relinquishment was without consideration and the AO relied on the absence of her brother’s confirmation, the latter was later produced in 2018, rendering that reason irrelevant.
The appellate tribunal observed that the remittance advice from Standard Chartered Bank described the transfer as “inheritance,” a credible third-party document, and the memorandum of transfer showed her name was removed from the records. The earlier-dated family arrangement recorded that she was to relinquish her 1/4th share for the stated consideration.
The CIT(A) had found no evidence of any other income source, and the addition was based on suspicion,ignoring the documentary and third party evidence filed by the assessee.
The tribunal upheld the CIT(A)’s order deleting the addition and dismissed the appeal.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
