Suspicion cannot substitute evidence – No Addition under Section 69A in respect of cash of Rs. 1 Cr seized at Railway Station
In a high-stakes case, the Hon’ble ITAT Raipur in the case of DCIT vs. Shri Satish Kumar Agrawal, ITA No.28/RPR/2015 has ruled in favor of the assessee despite ₹1 crore being seized at Howrah Railway Station by the GRP police.
The assessee, a director of Hind Energy & Coal Beneficiation Pvt Ltd and Hind Multi Services Pvt Ltd, demonstrated that the cash belonged to the companies.
He produced:
• Bank withdrawal proofs showing ₹81 lakh and ₹32 lakh drawn just days earlier,
• Cash book entries reflecting advance imprest given to him,
• Prior intimation letters dated 21.08.2009 submitted to the Income Tax Department about carrying cash for a property transaction in Kolkata.
The Tribunal firmly stated:
Suspicion cannot substitute evidence.
Where the nature and source are substantiated with proper documents, addition under Section 69A cannot survive.
Conclusion:
Where an assessee offers a credible and documentary-backed explanation for cash found in possession – including source, purpose, and prior intimation to authorities – the burden shifts back to the Revenue. In absence of concrete material to disprove such explanation, additions merely based on doubts, improbabilities, or suspicion cannot be sustained under the Income-tax Act.
The copy of the order is as under:
