ITAT: Addition u/s 69A Deleted as Property Investment was Sourced from Bank Withdrawals After a Prior Property Sale

ITAT: Addition u/s 69A Deleted as Property Investment was Sourced from Bank Withdrawals After a Prior Property Sale

Brief Facts of the Case

The assessee, Shanti Kumari Sharma, had made an investment of ₹7,52,060 to purchase an immovable property during the Assessment Year 2012-13. The lower tax authorities treated this investment as unexplained under Section 69A of the Income-tax Act and added the amount to her income². The assessee explained that she had sold another property on April 13, 2011, deposited the sale proceeds into her ICICI Bank account, and subsequently withdrew ₹8 lakhs (in two transactions of ₹4 lakhs each on April 19, 2011) to fund the new property purchase.

Decision of the Tribunal

The ITAT allowed the appeal in favor of the assessee and deleted the entire addition⁴⁴⁴. The Tribunal found that:

• The lower authorities had erred in law and on facts by not accepting the assessee’s explanation.
• The source of the investment was clearly explained by the cash withdrawals made from the bank account, which in turn was funded by the sale of a previous property.
• Since the source of funds was established, the addition of ₹7,52,060 was deleted.

Case Citation

Shanti Kumari Sharma vs. ITO

• Appeal Number: I.T.A. No. 4892/DEL/2025 
• Date of Judgment: 13th October 2025
• Tribunal: Income Tax Appellate Tribunal, Delhi Bench ‘SMC’