ITAT quashes Demonetisation addition: Funds Sent by NRI to Parents Not Unexplained Income:

ITAT quashes Demonetisation addition: Funds Sent by NRI to Parents Not Unexplained Income The ITAT Delhi deletes the Rs 11.18 lakh addition made on the grounds of the explained cash deposits made during the period of demonetisation, after noting that the cash deposits were rightly explained. The ITAT Delhi has recently delivered a common order for two appeals based on a similar issue revolving around a cash deposit of Rs 11,18,500 made during the period of demonetisation in November-December 2016. The assessee, Arun Bussi, a Non-Resident of India (NRI) residing in the United States (US), claimed that he used to send his aged parents money from the US on a routine basis for their survival and impugned that Rs 11,18,500 is the same unutilised amount that was available with his parents. This amount was required to be deposited into the bank during demonetisation, since the amount sent was in old currency.

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He further claimed that these funds were either transferred through services like MoneyGram or carried personally by him while visiting India. During the assessment, the tax authorities rejected the explanation given by the assessee and made an addition of the entire Rs 11,18,500 to the assessee's income on the grounds of unexplained deposits.

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The aggrieved assessee filed an appeal before the ITAT Delhi, furnishing all relevant documents in support of his claim, like bank statements, passport entries, and an affidavit detailing the source of funds and his visits to India. When the tribunal analysed each document in depth, it did not find any evidence of any undisclosed income of either the assessee or his parents. It was further observed that the assessee's aged parents were not capable of maintaining proper records of the money available with them. Considering the aforementioned findings, the tribunal deleted the impugned Rs 1,118,500 addition and ruled in favour of the assessee.