Explained cash deposits during demonetisation upheld where sales records, audits, and books showed no defects.

Cash deposits during the demonetisation period were treated as explained where regular cash sales were shown in the preceding and succeeding years, month-wise sales showed no abnormal trend, and the receipts were recorded in the sales account and included in declared profit. The audited accounts, accepted VAT returns, and absence of defects in the sales register, stock register, purchase register, or cash book supported the finding. As the Revenue produced no contrary material to displace these factual findings, the addition was deleted and the challenge failed.

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Issues: Whether the deletion of the addition made on account of cash deposits during the demonetisation period was justified.

Analysis: The assessee had shown regular cash sales in the preceding and succeeding years, the month-wise cash sales did not disclose any abnormal trend, and the cash receipts were credited in the sales account and included in the profit declared. The appellate finding also noted that the assessed accounts were audited, VAT returns had been accepted, and neither at the assessment stage nor at the remand stage was any defect found in the sales register, stock register, purchase register, or cash book. The Revenue did not place any contrary material to dislodge these factual findings.

Conclusion: The deletion of the addition was upheld and the Revenue's challenge failed.

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