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Issues: Whether, after the business income had been estimated by adding extra gross profit, a separate addition could still be made for unexplained cash credits as income from other sources.
Analysis: The assessee did not establish that the cash credits were genuine or that they represented income already included in the estimated business profits. The burden to explain the source of cash credits rests on the assessee, and unexplained credits may be assessed as income from an undisclosed source. There is no legal bar to adding such credits under a distinct head merely because the business income has already been estimated, unless the assessee proves by independent and satisfactory evidence that the credits are referable to the same disclosed business income. The precedents relied on by the assessee were distinguished on facts.
Conclusion: Separate addition of the unexplained cash credits was permissible, and the question was answered against the assessee and in favour of the Revenue.
Ratio Decidendi: Unexplained cash credits found in the books of a business may be separately assessed as income from an undisclosed source, even where the business income has been estimated, unless the assessee proves that the credits are attributable to income already taxed under that business head.
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