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of <h1>Appeal Partially Allowed: Gross Profit on Cash Deposit Added to Income, Not Unexplained Money Under Section 69A.</h1> <h3>Niraj Kumar Sahu Versus DCIT 5 (1) Bhopal</h3> Niraj Kumar Sahu Versus DCIT 5 (1) Bhopal - TMI Issues involved:1. Consideration of cash deposit as unexplained money under section 69A of the Act.2. Treatment of cash deposit in Saving Bank Account as undisclosed turnover and addition to total income.Issue 1:The appeal by the assessee was against the order of the Commissioner of Income Tax(Appeal) for Assessment Year 2012-13. The assessing officer had made an addition of Rs. 16,13,020/- to the income of the assessee, considering it as unexplained money under section 69A of the Act. The assessee contended that the cash deposit was already considered in the net income calculation as it was part of the business transactions and not undisclosed income. The Tribunal observed that the cash deposit was accounted for in the books of accounts and was explained to be from sales proceeds, thus not warranting treatment as unexplained money. The Tribunal directed that only the Gross Profit rate on the deposit be added to the total income.Issue 2:The assessee, an individual and proprietor of a business, had declared total income for the year but faced a reopening of assessment due to cash deposits in the Saving Bank Account. The assessing officer added the deposit to the total income, which was upheld by the Commissioner of Income Tax(Appeal). The assessee argued that the deposits were part of the business transactions, duly recorded in the cash book, and were utilized for regular business activities. The Tribunal noted that the deposits and withdrawals in the Saving Bank Account were not fully explained in relation to the business turnover. However, considering the nature of transactions and absence of complete details, the Tribunal directed the addition of only the Gross Profit rate on the deposit as undisclosed turnover to the total income.Separate Judgement:The Tribunal, comprising of Shri Vijay Pal Rao and Shri B.M. Biyani, allowed the appeal partly, directing the addition of only the Gross Profit rate on the deposit made in the Saving Bank Account with SBI to the total income of the assessee.
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