Cash deposit addition deleted where agricultural receipts and presumptive income under section 44AD explained the bank credits.

Cash deposits in the assessee's bank account were explained by reference to other income treated as business income in the relevant and preceding years, supported by an affidavit and ledger extract showing agricultural receipts. In the absence of any contrary material, the explanation was accepted and, since presumptive income had also been declared under section 44AD, a separate addition was considered unwarranted. The addition for the bank deposits was therefore deleted in favour of the assessee.

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Issues: Whether the addition of Rs. 11 lakh, made on account of cash deposits in the assessee's bank account, was sustainable.

Analysis: The assessee had shown other income in the relevant and preceding assessment years as business income and had produced an affidavit and ledger extract of agricultural receipts in support of the claim. In the absence of any contrary material, and having regard to the nature of the business, the explanation for the cash deposits was accepted. The assessee had also declared presumptive income under section 44AD, making a separate addition unwarranted.

Conclusion: The addition of Rs. 11 lakh was not justified and was deleted in favour of the assessee.

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