Estimated business income at 10% upheld; cash deposits treated as receipts, while Form 26AS addition needed verification.

Form 26AS-related addition required fresh factual verification to determine whether the same income had already been taxed and whether double addition existed, so that issue was remitted for verification. Cash deposits of Rs. 16,53,000 were treated as part of business receipts because their separate source was not established and the assessee had already been assessed on gross receipts at 10%, so the deposits were directed to be computed on the same basis. The challenge to estimation of income at 10% on gross receipts failed because the assessee did not prove reliable book results or any basis to disturb the adopted rate.

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Issues: (i) Whether the addition relating to Form 26AS reflected double taxation required fresh factual verification. (ii) Whether cash deposits of Rs. 16,53,000 were to be treated as undisclosed business receipts and assessed at 10%. (iii) Whether the estimation of income at 10% on gross receipts deserved interference.

Issue (i): Whether the addition relating to Form 26AS reflected double taxation required fresh factual verification.

Analysis: The issue depended on factual verification by the Assessing Officer to ascertain whether the corresponding Form 26AS figures had already been brought to tax and whether there was any double addition.

Conclusion: The issue was restored for fresh verification and was allowed for statistical purposes.

Issue (ii): Whether cash deposits of Rs. 16,53,000 were to be treated as undisclosed business receipts and assessed at 10%.

Analysis: Since the assessee had already been assessed at 10% on other gross receipts and the source of the cash deposits was not separately established, the deposits were treated as part of the business receipts.

Conclusion: The cash deposits were directed to be computed at 10% as consequential business income.

Issue (iii): Whether the estimation of income at 10% on gross receipts deserved interference.

Analysis: The assessee did not plead or prove audited book results as correctly reflecting the state of affairs, and no basis was shown to disturb the estimated rate applied by the lower authorities.

Conclusion: The challenge to the 10% estimation was rejected.

Final Conclusion: The appeal was partly allowed, with one issue remitted for verification, one addition subjected to consequential computation at 10%, and the challenge to the estimated rate of income rejected.

Ratio Decidendi: Where book results are not proved to be reliable, income may be estimated, and unexplained cash deposits may be treated as business receipts for consequential assessment on the same estimated basis.

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