INCOME TAX ACT, 1961

Section 69

Income from undisclosed sources - Addition under section 69 - Unexplained money in bank account - Validity of

Assessee was engaged in business of Civil Construction. In terms of the AIR information, assessee had deposited certain amount in Bank account. While explaining the source of such deposits before AO, assessee informed that such Bank account was a joint account, his wife opened such account and assessee joined the same as the second holder of account. Assessee's wife deposited the money in the said account out of her past savings and cash withdrawals out of her past earnings from salary, tuition income, interest income, receipts of various social function, sale of jewellery, etc. Pay-in-slips and cheques from the Bank revealed that most of instruments were bearing the signature of assessee, thus made addition under section 69 as unexplained receipts. Held: Assessee's wife in whose name amount was claimed to have been deposited either by assessee or herself was from her income from salary, sale of jewellery and other sources including Return as available seems to be genuine. AO did not take into account that the evidence relating to income from salary, stridhan, interest income for a prolong period in relation to the income of assessee's wife and preposition of deposition this money in a joint account by husband by putting his own signature instead of his wife does not necessarily lead to a conclusion that husband has deposited the same from his own income. Since genuineness of the source of income of the wife was not questioned by authorities, the entire addition could not be made as unexplained credit under section 69.

Relied:Sumati Dayal v. CIT (1995) 214 ITR 801 (SC) : 1995 TaxPub(DT) 1173 (SC) and Nemi Chand Kothari v. CIT & Anr. (2003) 264 ITR 254 (Gau) : 2003 TaxPub(DT) 1401 (Gau-HC).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. :

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