Peak credit addition upheld where bank credits remained unexplained and books were not first rejected.

Peak credit addition was sustained because the assessee failed to produce credible evidence explaining the nature and source of bank credits. The Tribunal treated the explanation as self-serving and found no worthwhile material to support the claimed commission income or rebut the peak credit computed by the lower authorities. On those facts, the appellate forum held that the estimation of peak credit was justified even without first rejecting the books of account, and no legal infirmity was shown in that approach.

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Issues: Whether the Appellate Tribunal was justified in upholding estimation of peak credit by the Assessing Officer without rejection of the books of account.

Analysis: The assessee failed to produce credible evidence to explain the nature and source of the credits found in the bank accounts. The Tribunal found that the explanation offered was self-serving and that no worthwhile material had been led to establish the claimed commission income or to rebut the peak credit worked out by the lower authorities. On those facts, the estimate of peak credit was upheld and no legal infirmity was shown in that approach.

Conclusion: The Tribunal was legally justified in sustaining the peak credit addition without first rejecting the books of account, and the issue was answered against the assessee.

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