Section 68 cannot be invoked for bank deposits where presumptive taxation applies and no books of account are maintained.

Section 68 applies only to sums credited in books of account maintained by the assessee; a bank passbook or bank statement is not books of account. Where income is returned on a presumptive basis under section 44AD and no books are required to be maintained, the foundational condition for invoking section 68 is absent. Cash deposits in the bank account could not, by themselves, justify an addition under section 68, and the addition was therefore not sustainable.

---

---

Issues: Whether section 68 could be invoked for cash deposits in the bank account where the assessee had filed return under section 44AD without maintaining books of account and whether a bank passbook could be treated as books of account.

Analysis: Section 68 applies only where a sum is found credited in the books of account maintained by the assessee. The definition of books of account does not include a bank passbook or bank statement. Where income is returned on a presumptive basis under section 44AD and no books are required to be maintained, the foundational condition for application of section 68 is absent. In such circumstances, the addition cannot be sustained merely on the basis of cash deposits in the bank account.

Conclusion: Section 68 was not attracted and the addition was not sustainable. The issue was decided in favour of the assessee.

Ratio Decidendi: Section 68 can be applied only when the impugned credit is found in books of account maintained by the assessee; a bank passbook is not such a book, and in a presumptive taxation case under section 44AD without books, the provision cannot be invoked.

---