New Delhi: The Income Tax Appellate Tribunal (ITAT) has dismissed a Surat-based businessman’s appeal over Rs 80 lakh deposited during the 2016 Indian demonetisation, ruling against his explanation for the cash.
The case dates back to November 2016, when the government scrapped Rs 500 and Rs 1,000 notes, re-quiring citizens to deposit old currency.
The businessman claimed the Rs 80 lakh deposited was with-drawn earlier from his own bank account for a property deal that later fell through.
However, the Income Tax Department questioned the source of funds, stating the taxpayer failed to establish the identity, creditworthiness and genuineness of the transaction. It argued the explanation lacked supporting evidence and was not legally tenable.
The taxpayer contended that his accounts were audited and not rejected under Section 145, and therefore Section 68—dealing with unexplained cash credits—should not apply. After hearing arguments, the ITAT Surat bench (I.T.A. No. 417/SRT/2025) ruled on March 26, 2026, against the taxpayer.
Mihir Tanna of S K Patodia LLP said such cases hinge on documentary proof & credibility of claims, noting that courts assess both legal provisions and the probability of transactions when adjudicating disputes involving large cash
holdings.